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Recently, I was very fortunate to animate a fireside chat with Jyoti Bansal in front of an audience of Harvard Business School Alumni as part of the Technology Roundtables series of the HBSANC. What a fantastic evening that was: AppDynamics’ story is fascinating, and Jyoti is really charismatic and such an incredible thought leader, everyone in attendance learned a ton and came out really impressed. For me, it felt like a timely lecture and advice from one of the great B2B entrepreneurs. In this post I wanted to share just a few learnings from the 90mn discussion with Jyoti, illustrated by his actual answers. I am a start-up founder and CEO and therefore I picked-up on certain things based on what is top of my mind right now, but I hope that you will like my selection.
I heard the notion many times that AppDynamics was focused on the “on premise” market at the beginning, while a company like New Relic focused on the “cloud”. In reality, AppDynamics was SaaS first, but Jyoti was simply intent on going after the Enterprise, and that market was largely on premise when they started. So he adapted and it’s a first pivot that set the company up for its massive growth ramp. Another impressive aspect of that time is that he architected the service to be able to work on both environments and offer customers a choice, which is actually technically very challenging. The reminder for all of us is: be ready to challenge your initial assumptions, pay objective attention to customer feedback, adapt quickly if you need. For that, it’s obviously important to have a technical team that can execute.
On setting expectations in the sales message
We touched up the early days and how he found his market. Jyoti has a conventional definition of product-market fit (“a product that people are willing to pay for”) and when one knows whether he/she has reached that stage (“five non friends and family accounts buying at the price you intend to sell to everyone, assuming you intend to have an annual contract value between $50,000 and $100,000”). I wondered about their messaging at the beginning: his advice was to sell what you have today. If your customers are more interested in other or future functionalities, then go back and work on your product before you sell to them. Having been on the receiving end of many B2B sales pitches where companies sell their future roadmap, I like his approach and found it a good reminder.
On product management
Jyoti is an engineer and product guy at heart. I quoted him back something he had said previously, which he might have coined: “innovation by embarrassment”. Behind the funny undertone, there is actually a philosophy of product management, team collaboration and process. The key takeaway there is the need to break the barrier between the customer and the developer, it’s super important to create alignment of views and for everyone in the organization to really understand the customer’s point of view. We live through it day to day and I totally agree with this view.
On scaling your executive team
Obviously, he hired lots of great people along the way and built a great executive team, but the very specific episode that stood out for me was the one where he related the story of how he let go of one executive who was doing well until then. He makes the point that executives need to constantly adapt their skillset to the needs of the company and anticipate the next phase, and it’s a very hard decision to fire someone who is doing well, but if you are convinced that they will not get the next level, it’s the right thing to do for the company and for the individual as well, before they are put in a position of failure and loss of confidence. It’s a tough judgement call and another great reminder.
I asked Jyoti about one of his tweets last year: “Always believe that culture is the biggest long-term sustainable differentiator that a company can have”. His main point is that culture defines a company’s identity, even as it goes through massive change. Technology changes, people changes, competitors, market conditions. Culture is what remains and therefore it’s the only long-term differentiator. This clip is interesting as it addresses how to define, maintain and nurture a great culture as well.
On managing your time as a leader
Jyoti addressed this topic twice, the first time he mentioned that as a CEO, he likes to spend a third of his time on product, talking to engineers, designing features etc. A third talking to customers, and a third on operations, such as fundraising, hiring, setting goals etc. I asked about the reason he decided to transition to become the chairman at some point. He had received multiple CEO awards, the company was doing very well and it seemed like an odd choice. His answer again, denoted a lot of humility and ambition at the same time.
Last but not least, a funny anecdote
To finish on a light note, here is Jyoti recalling an embarrassing moment doing a demo.
I am very grateful for Jyoti contributing his time and sharing his thoughts and advice to the community. If you are interested in continuing to learn from him, I highly recommend that you check out his posts on Linked In on a variety of topics ranging from the Science of Enterprise Software Sales to Raising Venture Capital, they are really well written and insightful. He is also on Twitter @jyotibansalsf and you can follow me there as well @SignifAICEO.
Thanks for reading