So far on our podcast, we’ve interviewed cleantech leaders that are in a later stage of their careers. We figured that wisdom comes from a combination of gray hair and track record.
Chad Farrell is different, and that’s a good thing. As the CEO of Encore Renewable Energy, Chad’s first company is his current company. Encore develops what it calls “community-scale” renewable energy projects, often on land reclaimed from past industrial uses. But Chad’s been driving Encore’s success for almost 15 years, which is plenty of time to gather a body of lessons learned we can pass to others in his position.
As a set of new sectors, most cleantech CEOs are younger, they’re company founders, and they are often in their first time as a CEO. That’s why we thought it was important to get lessons learned from someone with Chad’s background.
Transcript
- Introduction
- Chad’s background and path to becoming CEO
- Effective leadership style
- Advice to CEOs on hiring, firing, and retention
- The evolving role of a cleantech CEO
Introduction
Chad Farrell: We've tried to do a reverse brainstormer where we kind of think about how we want to create the absolute worst solar company ever. And then we solved for the opposite of that.
Mike Casey: And this scaling Clean, the podcast for clean economy CEOs, investors, and the people who advise them. I'm your host, Mike Casey. I run Tigercomm, a firm that counsels companies that are helping move the US economy onto a more sustainable footing. In each show, we bring you usable insights on how to scale and run clean economy companies and the people who are succeeding at building funding or advising the most successful firms in your sectors.
Mike Casey: As the CEO of Encore Renewable Energy. Chad Farrell's first company is his current company, but he's been driving its success for almost 15 years, which is plenty of time to gather a body of lessons learned that we can pass on to others in his position. But based on what we see from our firm, clean economy is a young enough set of actors that Chad's more the norm than the exception. Most of our sectors CEOs are younger, they're often company founders, or they're in their first time as a CEO, and that's why we thought it was important to get lessons learned from someone with Chad's background. And with that, we'd like to welcome Chad Farrell to the show. Chad, how are you?
Chad Farrell: I'm doing great, Mike. How are you today?
Chad’s background and path to becoming CEO
Mike Casey: I'm good. So let's start with your background. How would you summarize your path to your current job?
Chad Farrell: Sure. Yeah, I would summarize it as somewhat accidental. I was pretty turned off by the concept of climbing corporate ladders in the early days of my career. So I really never did. Instead, I focused on the fields of science in the early part of my career, establishing expertise as a groundwater hydrologist of all things, and then as an environmental engineer supporting corporations, utilities, and other institutions, regarding exposure to environmental liabilities, and then also eventually to real estate professionals looking to unlock the potential of environmentally impacted or contaminated land for redevelopment and reuse. But you know, I would say the mission was missing. We were essentially working for the polluters as I came to realize. And I would say also, you know, culture was missing. I wasn't really enjoying my career at that point.
Chad Farrell: And part of it was that I just don't think I was on the right bus with the right other fellow passengers. So and then finally I would say I wasn't scratching that entrepreneurial itch that I think I've always had to do something different and not necessarily conventional. So really I've come to leadership in this position on my own but always with the ideals that I've held, which is that business can be a force for good. And there is a lot of opportunity in cleaning up the mess of previous generations, whether that be with respect to our land use policies or whether that be, with respect to our energy generation policies.
Mike Casey: Were there things in your upbringing or your career that unbeknownst to you at the time, set you up to succeed in the role you're in now?
Chad Farrell: Yes. I have always had an appreciation for the value of hard work. Quite frankly, my dad worked his butt off. And I saw the value of hard work in not only my parents but their parents. This was I grew up in the seventies and the eighties and there was a lot of like there is today. There was turbulence back then and I really got an appreciation for that, the value of just putting your head down and doing the work. So I guess it's the concept of resilience and I think that's really important.
Mike Casey: Tell me about the first time you were somebody's boss. What mistakes did you make and what were the big lessons that you've carried forward into the years that followed?
Chad Farrell: I did work at an environmental engineering firm where I was responsible for growing and managing brownfields redevelopment practice. So this was the portion of the larger environmental engineering firm that was focused on characterizing cleaning up and making suitable for redevelopment from an environmental risk perspective, real property that was usually I'd say, 8 out of 10 times being redeveloped for commercial real estate. So I was the team lead there and I learned the value of being trusted, a teacher, and a guide. And that leadership does not always have to be push, push, push. And that motivating people requires their respect and their engagement in the culture that you're trying to create. So yeah, I guess it's important to mention that along those lines, I did learn the value of a strong culture and the mistake of not focusing on or advancing, or creating the best working culture for employees. So in Encore, it's almost like we've tried to do a reverse brainstormer where we kind of think about how we want to create the absolute worst solar company ever. And then we solved for the opposite of that.
Effective leadership style
Mike Casey: How have you changed your leadership style over the years? What are three things that you know now about leadership that you wished you knew when you first started your company?
Chad Farrell: I guess I'm realizing the importance of leaning into who we are as people, that it takes a team and really what a team truly means, which is meeting people where they are, lifting each other up, fighting for a common future together, and listening. So I think r, it's really encouraging people to bring their authentic selves to work and creating a safe culture for them to be able to do so because in doing so, we are now bringing them unencumbered to the tasks at hand. We're bringing them with positive mindsets to be able to solve challenging and complex problems, and we are allowing them to feel comfortable in who they are, and again, that brings out the best in people. I have also learned a lot about delegation, especially over the last several years as we've been able to grow out a team and I'm able to do less and less on the day-to-day and less and less working in the business and more and more working on the business.
Chad Farrell: So, I think it's always important for leaders to ask How can I help? Let's solve this problem together. But it's important to also understand the value of all of our respective time, and being available, listening, and being a sounding board, and letting others carry the water, and prove themselves and step up to new challenges. As long as we put the right processes and tools in place, and as long as we offer guidance and encouragement along the way, you're empowering people to step up and advance their own careers. And in doing so, freeing ourselves up as the leaders of the organization to do different things that we hadn't been able to do when we were sort of working again in the business too deeply.
And then finally, I don't think this probably comes as a surprise to many folks, but really the key to leadership, it's all about getting the right people on the bus and getting those right people in the right seats. We, at Encore, always want to understand where people are at, what they love about their current role, and what they would, perhaps, like to see change and people's interests shift over time. I mean, my career's a perfect example. I've evolved from day one and I think I'm not unique in that regard. So really it's about, um, empowering people and making sure that they're comfortable in their role and they're passionate about their role and similar to the way they feel from a culture standpoint and an engagement standpoint with the business. Allowing those kinds of engagements is only gonna increase productivity. It's the same thing.
Mike Casey: Who are your most important mentors and what did you learn from them?
Chad Farrell: I've gotta go all the way back to high school and high school I guess it was the mid to late eighties Acton, Massachusetts. There were early days for high school lacrosse in Massachusetts. And I started to play lacrosse when I think I was in sixth or seventh grade and practised and got better and ultimately got to high school and was in our city team. And we had a coach by the name of Jack O'Brien. And he was just a tremendous mentor and leader in my eyes at the age of 17-18. He brought a strong balance between sort of competitive fire and passion and winning with that of the importance of humility and just being good citizens. I'll share a brief story. He would not allow us as 16-18-year-old boys - high school kids - to swear on the field in practice or in games.
And if we ever did swear he would pull us out of the next game for at least a half. And I remember thinking that is, I mean, cause he wants us to be good representatives of the school and good upstanding young adults or moving towards being young adults. And I just thought that was fantastic. So we'd get into scrums and you'd go in for ground balls and, and you'd get hit by the other team and you'd hear all the kids on our team saying ‘shucks and shoot, and darn and heck’. And meanwhile, the other team swearing like sailors and I’ve just always thought that was a great sort of example of positive leadership and of setting the guardrails.
Mike Casey: Chad, you quit your job tomorrow to teach a class at the Grossman School of Business at the University of Vermont. Your first lecture is on the role of the effective CEO. What do you tell your students?
Chad Farrell: Gosh, I would say you've gotta set the vision. You've gotta have a problem to solve or that society needs to be solved. So you've gotta set the vision, then you've gotta put the tools in place to allow that vision to be embarked upon. And that's your blocking and tackling, right? That's the CRM that would be for us, we have a number of project development-specific tools that we utilize for managing our pipeline of projects, and managing the active development of our projects. So every business is gonna have tools that they need to have in their toolbox in the form of processes, software, whatever it may be. So once you've got the tools in place, I think you really gotta again get the right people on the bus, get them in the right seats. You've gotta make people feel safe. You've gotta listen, you've gotta raise capital, and then you've gotta get out of the way. I think I've been getting into the Ted Lasso show recently and I think you could summarize this whole question by being more like Ted Lasso. It’s a tremendous story of a tremendous leader who's just doing things very differently but ultimately has success as a result of it.
Advice to CEOs on hiring, firing, and retention
Mike Casey: Chad, hiring is often cited as one of the tougher parts of the job. You've mentioned it several times. What have you learned about hiring and retention that you could pass on to younger CEOs?
Chad Farrell: Sure. Well, again, I mean, so let's go hiring first and then retention. Hiring is a very important aspect of what any business leader does, new, mature, whatever. So we take a very deliberate approach to hiring, that does include putting together really accurate, robust job descriptions that speak to not only the position that you want to be filled but the type of person that you want filling it. And our position descriptions are deliberately intended to promote the diversification of the business. So we're actively seeking a more diverse workforce, and our position descriptions need to reflect that. So then I would say we also believe and we're fortunate to be able to do this now, right? That we have a more robust and mature and fully built out team where we can, have folks from all levels of the business participating in the interview process.
Chad Farrell: And we, where we can, we like to engage in multiple perspectives. I think the old cliche of hiring slow but firing fast is accurate here. But if you hire slow, hopefully, you don't have to fire. But if you do, you should do it fast. Um, and, you know, I think we try to again with thought around the protection of the culture that we've created, have a number of questions around the softer sides of the business to ensure cultural fit. That's been super helpful. Over the last bunch of years, we've considered giving potential applicants an assignment to complete.
Could be something that we're grappling with where an additional perspective would be helpful, but it also helps understand how that person thinks and how that person would tackle a problem or an issue or something associated with our work.
Mike Casey: A little bit of an unusual question, but one thing I've noticed in our hiring here is that the new pool of potential employees interviews and pursues jobs in a lot of ways that are different than I was raised to pursue jobs. For example, when I was coming up, if you had a typo in your cover or your resume, it was death to your candidacy, you would not be even considered. And now, at least in our line of work, we're hiring writers and communicators, and I am looking for the people who had the fewest typos, the people who actually do research on us, who will choose to tailor and formalize their communications in a thank you email. How are you seeing the differences in the new potential employees versus those that are more of your age contemporaries? And how are you adapting to those differences?
Chad Farrell: It's a great question, Mike. And yeah, I'm right there with you and understand that there are differences in our relative generations. And we're proud that at Encore we do have diversity across the age spectrum as well as racial and gender. But I definitely agree that it's a different game now. There really is a battle for talent out there. This kind of speaks to your previous question regarding retention. I think I would say that we're certainly in a post-pandemic world, things have sort of been flipped on their head and we're able to engage with folks that don't necessarily live in the same community that we do. And that's created a bunch of opportunities. It's also created some complexities but it goes back to me, it goes back to the culture and communicating and engaging with everybody across the team and, and making everybody feel safe and valued. That is how we are going to succeed on the retention front.
Mike Casey: You mentioned it briefly earlier, but what's the guidance you would offer to younger versions of yourself on firing people beyond it, doing it quickly? What tells you it's not working out as a fit?
Chad Farrell: Well, fortunately, I think we're not to pat ourselves on the back too firmly, but I think we've done a decent job with our hiring process in that we haven't had to do too much firing. I think at the end of the day we've all been in relationships that don't work out. And I think if we can remove our emotions from all of these hard conversations, we have a path towards a productive conversation. And if it's not a good fit, it's not a good fit. And hopefully, there's realization of that on both sides. If we can help sort of set that tone that would be helpful, that will be helpful. So I guess it goes to another important concept that we've embraced at Encore, which is the concept of emotional intelligence.
Chad Farrell: We know that life in this industry is anything but predictable. We know that we're going to have the door slammed in our face. We know we're gonna have great success, but we've gotta be able to, through the successes and through the challenges, maintain a consistent demeanor and one that is not volatile and confrontational, and we've gotta keep our emotions in check. And I think bringing emotional intelligence to the table is another tool for retention, that hopefully you're not creating a workplace that does become toxic and that does become easier for folks that you wanna retain to leave.
Mike Casey: What's the most valuable interview question you have ever asked a candidate?
Chad Farrell: I'll give you one. So one would be with respect to self-regard, we could ask the candidate, tell me about a time when it was clear that you had made an error or a mistake, and what did you do to rectify the situation and how did you feel? And what we're seeking there is we're looking for issues regarding ego, self-confidence, the ability to admit a mistake, the further the ability to put a plan in action to mitigate or rectify that mistake. And then we're also wanting to incorporate a human element to it. Like, how did you feel, that can tell us about the empathy of the individual. I mean we all want to take ourselves seriously, but there's also a time and a place when it's okay. It's always okay to admit that we make mistakes if we feel we're in a trusted, effective working engagement. Yeah, there's a handful of others, but I'll go without.
Mike Casey: Based on your experience running Encore, would you say that the success to date is more a product of what you have chosen to do or is it more a product of what you have chosen not to do?
Chad Farrell: Wow, that's a good one. I think it's the former because I do believe in the power of planning and there have absolutely been instances where we've decided not to pursue a certain segment or we've decided not to pursue a certain project, or we've decided to move away from a certain program and being deliberate in our growth and being deliberate in taking iterative steps towards growing each sector of the team and making sure that we've got the right tools in the toolbox to support the team that we have in place. And that means communication tools and process tools, and certainly making sure we have the right folks on the team.
The evolving role of a cleantech CEO
Mike Casey: A great segue to our last question. How will the job of the Cleantech CEO be different in 10 years than it is today?
Chad Farrell: It's gonna be a great position to be in when we are more like an incumbent industry than we are an upstart. So, for us at Encore it's shifting from just an always hustling kind of like eating what we kill, kind of mentality and approach to business. Meaning, we originate a project, we work like heck to design it, permit it, finance it, and then build it, but we're basically selling these projects to other investors as we move forward to owning assets. I think that's gonna be a change. And I think there's gonna be more clean energy CEOs that are managing more mature asset, rich, or asset associated businesses, then there are hustlers out there that have defined the last 10 or 15 years.
Chad Farrell: Right? Really just sort of trying to move as fast as possible to sell the project you're working on so you can fund the next two or three projects in the pipeline. So I think there will be a need for managing more mature, larger scale businesses that have multiple business lines, for lack of a better word, meaning, we're not just originating projects, developing them, and flipping them. We now need to incorporate storage into the solar projects, we now need to think about different tenor contract lengths. We gotta get smarter about future power curve estimation. We've got to build asset ownership, an asset management group. So it’s gonna be a really interesting 5 or 10 years here. It's gonna be a lot of fun, but there's gonna be a lot of change as well. And we'll see where we end up in 10 years. I hope I'll still be doing this, but I don't know that either.
Mike Casey: Well, Chad Farrell of Encore Renewable Energy, it has been a pleasure having you on Scaling Clean. We're delighted you came on and shared your mid-career observations and lessons learned. I think you are absolutely the norm in this industry in terms of age and career, career trajectory for other CEOs, and I think people find it lonely at the top, so to speak, such that the top is, and I think that hearing from their peers in a candid way that you've had the courage to express yourself is really helpful and a big benefit to a lot of people who you probably will never meet. But anyway, on their behalf, I wanna thank you. Such a great conversation and we're gonna be in touch. So thanks Chad. We really appreciate the time.
Chad Farrell: Gosh, thanks, Mike. I really enjoyed the time as well, and look forward to staying in touch. Take care.
Mike Casey: This is Scaling Clean at the production of Tigercomm. And I'm Mike Casey. Thanks for joining us. You can subscribe to our show free anywhere you get your podcast. And while you're there, please leave us a rating and review. We'd love to hear from you. Thanks for listening.