Podcast Summary
Figuring it out and shipping it: Embrace ambiguity and challenges, figure it out, and iterate to achieve your goals. Be like Twilio and 'draw the owl'.
Learning from this conversation between Patrick O'Shaughnessy and Jeff Lawson, the founder and CEO of Twilio, is the importance of figuring it out and shipping it when building a business or a project. The meme "draw the owl" that became a symbol in Twilio's early days represents this notion. The meme suggests that there is no instruction book or clear path to achieving a goal, and it's up to individuals to figure it out and iterate. This mindset encourages builders to embrace ambiguity and challenges, making it an essential value for anyone looking to create something new. Additionally, the conversation highlights the benefits of being a platform business and the importance of company culture. Overall, this conversation offers valuable insights for anyone looking to build a successful business or invest in the tech industry.
Listening to customers and trusting their vision: Following customer needs and trusting their vision can lead to building innovative and successful products using APIs as essential building blocks for developers.
Following customer needs and vision, even if it goes against conventional wisdom, can lead to building innovative and successful products, like Twilio and its APIs. APIs are essential building blocks for developers, enabling them to create applications more quickly, scalably, and globally by utilizing pre-existing infrastructure. Unlike apps that offer specific solutions, APIs provide developers with the tools to customize and integrate various functionalities into their projects. By listening to customers and trusting in their vision, entrepreneurs can create game-changing products, such as AWS for compute and storage, and Twilio for communications, that transform industries and make technology more accessible to everyone.
The shift towards digital economy necessitates mature software supply chains: Companies need sophisticated software supply chains to engage digitally, reducing risk, increasing accessibility, and lowering costs through platform models.
The rapid growth of companies like AWS, Twilio, and Stripe can be attributed to the shift towards a digital economy and every company's need to become a software builder to engage with customers digitally. This has led to the recognition that every company needs a mature supply chain to power their software development, similar to how mature industries have sophisticated supply chains for building cars. The last 15 years have seen the emergence of a platform revolution, where instead of building software from scratch, companies can rely on these platforms to provide essential services and tools, reducing the need for extensive in-house development and resources. This shift from traditional enterprise software to platform models has made software implementation less risky, more accessible, and more cost-effective. AWS, the fastest growing enterprise software company, is a prime example of this trend, as it doesn't sell software or seats but rather provides a platform for companies to build and scale their digital offerings.
From cost center to competitive advantage: Invest in building your own software capabilities to provide great customer experiences, stay competitive, and adapt in the software-driven business age.
In today's business landscape, software development is no longer a cost center but a source of competitive advantage. Companies that once outsourced their software needs to vendors are now realizing that building their own software is crucial to providing great customer experiences and staying competitive. This shift from a buy or build mentality to a build or die mentality is evident in the success of software platforms like AWS, Stripe, and Twilio. These companies provide fundamental ingredients for every app, enabling developers to create unique and innovative solutions. For businesses that are not software providers but want to incorporate software into their business model, the recommendation is to invest in building their own software capabilities. By hiring software developers, listening to customers, and iterating quickly, companies can create a product experience that sets them apart from competitors and digital disruptors. In the age of software-driven businesses, the ability to build and adapt is the key to survival and success.
Digital banks disrupting traditional finance with software expertise: Digital banks challenge traditional finance with superior customer experiences and software development skills, forcing incumbents to adopt agile practices and act like startups to compete.
In the world of finance, particularly in Europe, traditional banks are facing disruption from digital challengers who describe themselves as software companies with banking licenses. These digital banks offer superior customer experiences through easy-to-use apps, and their core competency is software development. The incumbent banks are responding by adopting agile practices and acting like startups to compete. At Twilio, as a platform, we learn from our customers and allow them to build solutions tailored to their specific needs. The dynamic of build versus die is playing out in the banking industry as companies live or die based on their ability to provide great software products that meet customer needs. For software builders, it's essential to adopt a product mindset that prioritizes customer learning and collaboration to create solutions that truly address their pain points.
Identifying unmet needs and creating solutions: Observing customer usage and feedback can lead to the discovery of unmet needs and the creation of innovative solutions. By building a flexible platform, companies can unlock new opportunities and meet the unique needs of their customers.
Listening to customers and observing their usage of a platform can lead to the identification of unmet needs and the creation of innovative solutions. The example given was Twilio's discovery of the need for a customizable contact center solution in the market, which led to the development of Twilio Flex. The contact center market was identified as being "broken" with most companies still using on-premises solutions and unable to transition to the cloud. By building a platform that allowed customers to customize and extend the functionality of their contact centers, Twilio was able to unlock new opportunities and provide a solution that met the unique needs of their customers. This approach of being a platform company, allowing flexibility for customers to build what they need, and maintaining close relationships between customers and product teams, has been successful for Twilio.
Involve developers in key business decisions: Businesses should view developers as strategic partners and consult them on major decisions to leverage their technical expertise and foster innovation.
Businesses should involve their developers in key decision-making processes, particularly when it comes to solving complex business problems. The speaker shared an anecdote about a marketing campaign for their company, Twilio, where they initially dismissed an idea presented by one of their developers during a brainstorming session. The developer suggested using the phrase "ask your developer if Twilio is right for you" for their billboard campaign. Although it seemed simple, the idea resonated with their developer audience and subtly communicated the importance of trusting technical expertise in business innovation. The speaker also highlighted the common mistake of businesses, where they separate product development from the business strategy. Instead, businesses should collaborate with their developers and involve them in the problem-solving process from the beginning. By doing so, businesses can leverage their developers' technical knowledge and creativity to find innovative solutions and ultimately create better products and services. In essence, the takeaway is that businesses should view their developers as strategic partners and consult them on major business decisions, rather than just assigning them tasks. This approach not only fosters innovation but also strengthens the overall team dynamic.
Shift from tasks to problems: Allow developers to engage in problem-solving processes to foster creativity and innovation, leading to better solutions and increased job satisfaction
Companies should shift their approach to collaborating with software developers by sharing problems instead of tasks, allowing them to fully engage and utilize their creativity. This not only leads to better ideas and solutions but also improves retention and job satisfaction. Agile methodologies, while effective, can unintentionally turn software development into a factory system, stifling creativity. Instead, companies should involve developers in the problem-solving process, allowing them to ideate, design, and build solutions. Hackathons, where developers are given a short period to solve problems creatively, demonstrate the potential of this approach. By recognizing developers as creative problem solvers and allowing them to use their skills throughout the year, companies can foster a more productive and innovative software development process.
Unlocking developers' potential through collaboration and engagement: Encouraging developers to share ideas and input leads to creativity, engagement, and a strong tribe culture, resulting in better work and increased job satisfaction.
Companies can unlock the full potential of their developers by asking for their ideas and input instead of just telling them what to do. This approach not only encourages creativity and engagement but also fosters a sense of belonging and tribal identity among employees. Companies that effectively define their heroes, symbols, and rituals can create a strong tribe culture, leading to better work and increased job satisfaction. The concept of startup weekends, where developers come together to build ideas outside of their day jobs, illustrates the passion developers have for problem-solving and the potential value they bring beyond their regular work hours. By asking developers for their insights on major business challenges, companies can harness this energy and innovation to drive growth and success.
Understanding a Company's Heroes, Rituals, and Symbols: Companies have unique identities shaped by heroes, rituals, and symbols. Heroes inspire and unify, rituals define culture and create belonging, and symbols give meaning and serve as guiding principles.
Companies, like any group of human beings, have unique identities shaped by their heroes, rituals, and symbols. Heroes are individuals or organizations that inspire and unify a company through their accomplishments and shared vision. Rituals, such as regular meetings or traditions, help define a company's culture and create a sense of belonging. Lastly, symbols, like values, give meaning to a company's culture and serve as guiding principles. By understanding and embracing these elements, companies can build a strong, cohesive identity and foster a positive work environment.
Values as Guides for Decision Making: Values help ensure a company stays true to its desired culture by guiding decision-making. Effective values are human, relatable, and easily understood, and should be invoked in daily work. Involve diverse employees in their development and allow for evolution over time.
Values are essential for building and maintaining a strong company culture. Values act as handles that guide decision-making and help ensure that a company stays true to its desired culture. It's important to carefully articulate values that are representative of the company and resonate with employees. Values should be human and relatable, and employees should be able to easily understand and apply them in their daily work. One way to determine if values are effective is to listen for them being invoked in decision-making conversations. For example, if a team is debating between two options and one feels like "shenanigans," it's likely that the value of "no shenanigans" is working effectively. When developing values, it's important to involve a diverse group of employees in the process and to allow for evolution over time. Additionally, values should be memorable and easily invoked, making them effective tools for guiding decision-making in everyday situations.
Encouraging employees to walk in customers' shoes: Embody customer-centricity by displaying customer shoes, asking why behind customer actions, and decreasing the proximity between decision-makers and customers.
Building a customer-centric culture involves more than just stating a value; it requires actively embodying that value through symbols, rituals, and heroes. At Twilio, they do this by encouraging employees to "wear the customer's shoes" by literally exchanging shoes with customers and displaying customer shoes around the office. This constant reminder keeps the focus on the customer and encourages employees to ask why behind customer actions. For businesses not building platforms, this concept can still be applied by asking why customers make certain decisions, getting close to customers to understand their needs, and building closed-loop feedback systems to continually learn from them. Additionally, decreasing the proximity between decision-makers and customers can help ensure that everyone is aligned with the customer's perspective.
The importance of mentorship and small, agile teams: Mentorship and small, agile teams foster better decision making, improve work, and promote resilience.
Creating proximity between product teams, developers, and customers is crucial for making better decisions and doing one's best work. This can be achieved through small, agile teams where team members feel they have agency over the outcomes they're building for their customers. A mentor's kindness and belief in one's abilities, even during difficult times, can also significantly impact one's entrepreneurial journey and resilience. The story shared highlights the importance of having a mentor who invests in both personal and professional growth, and the power of isolation and focused brainstorming in generating new ideas. Despite not making a financial return for his mentor, the speaker expressed deep gratitude for the opportunities and lessons learned.
The importance of mentorship in entrepreneurship: Mentorship goes beyond financial support, sharing time, knowledge, and expertise is crucial for entrepreneurs to succeed. Join Patrick Collison's book club for curated business books and follow him on Twitter for insights.
Learning from this conversation with Patrick Collison, the co-founder and CEO of Twilio, is the importance of mentorship and guidance in the entrepreneurial world. Patrick emphasized the value of not just providing financial support, but also sharing time, knowledge, and expertise to help entrepreneurs bring their visions to life. This exchange highlighted the significance of the entrepreneurial industry and the impact that experienced individuals can have on the next generation of business leaders. For those interested in mentoring or learning more about entrepreneurship, consider joining Patrick's book club at investorfieldguide.com/bookclub for a curated selection of new books each month. Additionally, be sure to follow Patrick on Twitter at @patrick_oshag for more insights and updates. Lastly, don't forget to leave a review on iTunes to help spread the word about Invest Like the Best.
