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First Round Capital

Why great leaders make themselves obsolete | Eric Sager (COO, Plaid)

In the latest episode of Executive Function, Brett sits down with Eric Sager, COO of Plaid, following stints as CRO of Bluevine and Head of Sales at Square.

Brett BersonhostEric Sagerguest

Jul 16, 20261h 10mWatch on YouTube

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CHAPTERS

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Chapter summaries

COO leadership during repeated shocks: staying focused on customers and the ecosystem
Brett Berson asks what’s unique about leading through rapid change, and Eric Sager argues it’s been a constant rather than an exception. He explains how Plaid kept momentum by centering execution on customers and the broader ecosystem instead of getting consumed by headline events.
- •Eric Sager says turbulence has been present at nearly every stage of his time at Plaid
- •Maintaining progress requires ruthless focus on serving customers and the ecosystem
- •Leadership messaging frames major events as milestones rather than finish lines
- •Only a small subset of people should be deeply pulled into transactional work so the rest can keep building
- •Resilience comes from sustained cultural focus, not reactive communications
Building a resilient culture on purpose: define it, hire for it, and reward it
Pressed on how culture is actually constructed, Eric Sager emphasizes intentional design rather than letting it emerge by accident. He describes making explicit trade-offs in hiring and tying promotions and rewards to cultural contribution, not only results.
- •Culture requires deliberate formalization rather than leaving it to chance
- •Eric Sager credits founders for proactively shaping the culture they want
- •Hiring must reflect real trade-offs, especially for leadership roles
- •Promotion, raises, and equity should reflect cultural contribution alongside outcomes
- •Culture becomes the ballast that helps the company handle volatility
Culture under pressure: resisting short-term shortcuts and addressing high-performer behavior
Eric Sager describes the most difficult moments as those where cultural principles conflict with short-term metrics or outcomes. He also discusses the common scenario of a high-performing person who violates norms, emphasizing direct feedback and distinguishing intent from impact.
- •The hardest tests come when a shortcut would improve short-term metrics but undermines principles
- •Compromising “just once” tends to repeat and erodes culture over time
- •Direct, candid feedback is required when someone’s behavior harms the culture
- •It’s important to discern whether harmful behavior is intentional or unintentional
- •Many people course-correct when they understand how they’re being perceived
Avoiding bureaucracy at scale: clear decision ownership and fewer management layers
As Plaid grew, Brett Berson raises the inevitability of slowness and bureaucracy. Eric Sager outlines two counterweights: crystal-clear decision-making ownership and an organizational preference for minimal layering, including leaders who can still perform individual-contributor work.
- •Scale increases complexity, but also gives more resources to fight bureaucracy
- •Teams should be explicit about who the single decision-maker is for each initiative
- •Collaboration is encouraged, but accountability shouldn’t be spread across multiple owners
- •Plaid intentionally avoided building heavy layers of middle management
- •Senior leaders are expected to still do individual-contributor-level work
Speed isn’t always better: optimizing speed, risk, and cost
Eric Sager rejects the idea that faster is always better, especially in domains where correctness is critical. He explains how decisions are framed as trade-offs across speed, risk, and cost, and how that framing evolves as technology, competition, and regulation change.
- •Execution is an optimization across speed, risk, and cost—not speed alone
- •Some areas require methodical precision because getting details wrong has real consequences
- •Trade-offs should be made explicitly and communicated upfront
- •The chosen balance can change as capabilities and market conditions evolve
- •Eric Sager describes a productive tension with Zach: pushing speed vs being methodical
GTM org evolution #1: from generalists to size-based segmentation
Eric Sager walks through how Plaid’s go-to-market organization evolved as customers and products diversified. He explains why early-stage teams can stay generalist and simple, then later need segmentation once customer needs and sales motions diverge.
- •Early on, one product and one sales motion made a generalist structure workable
- •A guiding principle in the early stage is avoiding unnecessary complexity
- •As product lines expanded, customer needs began to diverge by company size
- •Plaid moved to size-based segmentation (conceptually “T-shirt sizing”)
- •The trigger was hearing meaningfully different expectations across customer types
End-to-end segment ownership: fixing handoffs by owning the full customer relationship
Eric Sager describes a key structural change: collapsing functional handoffs by placing sales, account management, and support within each segment. The intent was to improve the customer experience and create accountability for smooth transitions across the lifecycle.
- •Functional separation created friction at handoffs between sales and account management
- •Eric Sager emphasizes seeing the experience through the customer’s eyes
- •Segments were structured so one leader owned the full end-to-end customer relationship
- •Closer accountability improved customer satisfaction and implementation success
- •The model also improved cross-sell and upsell effectiveness across products
Specialization trade-offs: reduced fungibility and the need to anticipate demand
Brett Berson asks about downsides of segment-based, end-to-end ownership. Eric Sager explains that specialization reduces flexibility in moving people across segments, increasing the importance of forecasting and staying ahead of capacity mismatches.
- •Specialization reduces fungibility compared to a more generalist model
- •Mismatch risk increases if growth shifts faster in one segment than expected
- •It’s hard to quickly convert startup-focused talent into enterprise-focused roles (and vice versa)
- •Ramp-up time creates risk if capacity isn’t aligned with segment demand
- •The trade-off is better segment fit and customer experience vs flexibility
GTM org evolution #2: adding verticals and then a ‘quarterback + experts’ structure
Eric Sager explains the next waves of organizational evolution: deeper specialization by industry verticals, and later the addition of horizontal product experts to support vertical teams. The goal is one accountable owner for the relationship, with specialists available for deeper product areas.
- •Within enterprise, industry verticals (like healthcare vs real estate) buy differently
- •Vertical specialization let teams repeat and refine the same motions over time
- •Product expansion required additional expertise in areas like fraud, payments, and credit
- •Vertical owners act as the “quarterback” across the whole Plaid relationship
- •Horizontal expert teams provide deeper product-specific support when needed
Learning from org timing mistakes—and why the company shouldn’t run at 100% capacity
Asked what he’d change, Eric Sager notes there are places Plaid specialized too slowly and others where it scaled too early. He argues for building resilience through flexibility and spare capacity, which allows rapid response to new opportunities and threats.
- •Eric Sager says hindsight always reveals both over- and under-specialization decisions
- •Scaling too early can be a mistake when the work is still “zero to one” and needs co-creation
- •Specializing too slowly can also hold back execution when needs clearly diverge
- •He strongly prefers not operating at 100% capacity, accepting some inefficiency
- •Spare capacity enabled quicker mobilization when new opportunities emerged
Product and engineering alignment: product areas, customer needs, and the network lens
Brett Berson asks how product and engineering fit into an increasingly complex org with many segments and products. Eric Sager describes product-area ownership and notes that roadmap decisions usually don’t require cross-product bargaining, while a key shared lens is what grows the network for the ecosystem.
- •Plaid organizes product/engineering into product areas (e.g., payments, fraud, credit)
- •Teams aim to build the best solution per area, rather than trading features across products
- •Eric Sager says it’s rare for customers to require feature swaps across product lines as a condition to buy
- •An important additional lens is how decisions help grow the network and ecosystem
- •He illustrates how more connected accounts can make consumer experiences more seamless
Customer success philosophy: ‘always available, never needed’ and driving multi-product adoption
Eric Sager explains how Plaid thinks about support and account management: make help easy to access, while building products so strong that many customers can implement and scale without human involvement. He also describes expansion as starting with awareness of newer products, paired with optional expert engagement when needed.
- •The support ideal is “always available, never needed”
- •Products are built to be self-serve, and some large customers scale without talking to anyone
- •Plaid monitors integration health and proactively engages when it can improve outcomes
- •Expansion often starts with educating existing customers about newer solutions
- •Relationship owners can pull in horizontal experts, backed by implementation and solutions teams
Defining COO excellence: ecosystem impact, fair value capture, and the ‘hit by a bus’ test
Eric Sager lays out how he evaluates excellence in his role across three vectors: ecosystem value creation, Plaid’s business outcomes, and the strength of the team and operating engine. He frames success as building an organization that continues to run well even if he suddenly isn’t there.
- •Excellence includes whether the ecosystem creates more value for consumers than before
- •He also tracks whether Plaid captures a fair share through growth and revenue
- •A major test is whether the company would keep operating well if he were suddenly gone
- •He takes pride in making himself “useless and obsolete,” then shifting to the next point of attack
- •He keeps some hands-on work because he enjoys it and it keeps him sharp
Staying close to the point of attack: what he still does as an IC and why he cold-calls new hires
Eric Sager describes how he decides what to personally own: importance, reversibility (“one-way door” decisions), and whether the internal team has the talent and capacity to execute. He also argues that leaders must stay close to frontline reality, including directly reaching out to newer employees and engaging at multiple layers of the org.
- •He still directly works certain big partnerships and cutting-edge deals because he can decide quickly
- •His decision filter: importance, one-way vs reversible decisions, and internal talent/capacity
- •He sometimes calls individual contributors directly, which can surprise them at first
- •He believes great leaders can’t be too far removed from frontline work and still be effective
- •Personal spare capacity lets him respond quickly to unique opportunities or threats
Operating cadence: weekly rhythms, time allocation, and assessing mission alignment in interviews
Eric Sager maps his weekly time across ecosystem health, business health, and team development, and shares recurring rituals like a Monday leadership meeting that begins with customer learnings. He also explains how he screens for genuine mission alignment—especially by probing the coherence of a candidate’s job search and using references from people they sold to.
- •He estimates his time split as roughly 25% ecosystem, 50% business, 25% team
- •Monday leadership meetings start with what each leader learned from customers that week
- •Cadences include pipeline/forecast reviews and deal reviews to run the business
- •In interviews, he asks what other roles candidates are pursuing and why
- •He validates claims by calling references, including customers a candidate previously sold to
What founders uniquely bring—and how he’s changed as a leader (resilience, team investment, legacy)
Eric Sager argues founders have an irreplicable relationship to the company: it’s “their baby,” which creates unusual resilience through downturns and uncertainty. He closes by reflecting on his own evolution—showing up better for his team, investing in internal talent—and what he hopes people remember about the impact on consumers and the growth of those who worked with him.
- •Founders can have a unique, non-replicable commitment because the company is fundamentally theirs
- •That bond can create resilience through the hardest periods when others might quit
- •He says mis-hires often come from lack of culture/mission buy-in or overvaluing “expertise” alone
- •He believes he’s grown most in how he supports and develops his team, giving people room to learn
- •His hoped-for legacy: better outcomes for consumers/customers and helping teammates reach their potential

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