We Raised a $15.5M Series A to Make Compliance “Left of Boom”
When I joined the United States Army, I learned a bunch of new words and phrases, and one that stuck with me is “left of boom.” At that time, the army was focused on wars in Afghanistan and Iraq, where improvised explosive devices were wreaking havoc. “Left of boom” meant finding roadside bombs before they detonated by, for example, disrupting enemy supply chains.
Explosives, like many bad things, are best dealt with proactively. Unfortunately, institutional inertia favors lazy, reactive, “right of boom” approaches. Usually, we deal with issues only after they do real damage.
I’ve been out of the military for years, but when I started Ethena, a platform for modern compliance training, I remembered the “left of boom” concept because it’s so different from how compliance training typically works.
Compliance is historically a reactive industry. When something bad happens at a company, the compliance team is usually given the task of minimizing the impact. To belabor the metaphor, compliance adds even more armor to a vehicle instead of looking for the root cause of the issue. So much energy is put into reacting that there’s little energy left to prevent the issue from happening again.
But there’s a better way. We’re building compliance to reduce the likelihood of issues, not just react to them. We’re proud to share that we’ve already changed the model, and we just raised $15M to keep raising the bar.
“Right of Boom” is Wrong
The Harvard Business Review—not one for hot takes—described the current state of compliance as “a box-checking exercise, making employees sit through training and attest that they understand the rules, but failing to assess the effectiveness.”
Not only are these approaches ineffective, there’s evidence that compliance training can actually encourage bad behavior. In the case of harassment prevention training, for example, the New York Times explained, “At worst, [training] can make them uncomfortable, prompting defensive jokes, or reinforce gender stereotypes, potentially making harassment worse.”
We all know the drill. Every year, we sit through hours of mind-numbing videos where actors (not Meryl Streep) read rote lines like, “Don’t give or receive bribes, and don’t harass your colleagues, it’s not cool!” Next year, we’ll watch the same video.
Why are we doing this? Everyone knows that the video isn’t actually proactively stopping, say, bribery. Employees go through this because the compliance industry is developed around “right of boom” thinking. Say Ted from Sales sits through his annual bribery training and then he gives a bribe to get a big deal done. His company gets to say, in legal speak, “Look, we told Ted not to. 🤷♀️”
This reactive approach is bad for everyone. Employees are frustrated because their time is wasted and they don’t have practical tips for tricky situations. Companies are frustrated because they want to emphasize the importance of being ethical and inclusive, but sending yet another dated video won’t help.
Let’s Just Start Over
When we started Ethena, we asked the question, “how would you train if you actually intended the training to be effective?” We weren’t interested in making traditional, ineffective training just 10% better. We wanted to reinvent it, meaning that Ted from Sales would actually learn what a bribe is (yes Ted, it could be an internship).
To make training that really helped change behaviors, a few elements were key:
Repetition: Training has to be more than just a once-a-year activity. The U.S. Equal Opportunity Commission has been saying this for years. A short, monthly reminder is far more effective than an annual “one-and-done” approach.
Accessibility: We needed to reach people in their flow of work. Integrations with Slack and magic links in emails clears the barrier to participation.
Relevance: The content has to be tailored to a learner’s workplace. Training for tech needs to look different than training for, well, the army.
Innovative, thoughtful companies were hungry for this better solution. I remember one of my earliest sales calls with a scaling Boston-based company. Their People Ops leader said, “Honestly, we haven’t even rolled out harassment prevention training because all the solutions were terrible. Bad training is worse than no training because if I put bad training in front of my team, they’re going to think that we don’t take these issues seriously.”
When I told her about our new approach—how we delivered digestible training every month, developed with academics and artists (and yes, lawyers)—her eyes lit up. She deployed our training, gave incredibly helpful early product feedback, and remains a customer today.
Since those early sales, we’ve built out our platform so that learners get an incredible experience training and our admin experience is seamless. A few stats to share what we’ve accomplished:
150+ customers including Netflix, Zoom, Zendesk
250,000+ positive in app ratings
~75% of our training nudges completed on time
With our $15.5M in additional capital, we’ll be hard at work on these developments:
Expanded course library, including:
Global Anti-Bribery and Corruption
Hiring and Interviewing (think: hiring within the law)
DEI, in collaboration with Frances Frei
Code of Conduct
Obviously, we’re hiring for many roles, and we’d love to share our training with your team (you can request a demo here). Thanks for coming with us on this journey, and we’re so excited for what’s to come!
Check out coverage of our Series A raise in Forbes!