Radiowalker: Tech Business Beat

This weekend was an emotional moment for me. We moved our San Francisco office from its humble original space to spacious new quarters on another floor in our building.

Every time I move houses I make a point of going back into the house, once its empty, and sitting in the middle and thinking. Saturday when the movers finished, I had to take this picture of where it all started. Ben Naftzger from Sydney opened the office with me in September 2005. Benny and I sat here using both ends of this little printer table…

On this table, there was enough room for our laptops and nothing else. We started with a VOIP phone and mostly our mobile phones. I wrote the Craigslist ads, and Benny and I started interviewing.

The memories from starting up are indelible and often laughable, because you often try to spend as little as possible:

I remember Ben arguing with me at Office Depot about why we should buy a $59 phone instead of a $79 phone. Ben being a Cheap Ass was good for the business. Startups need Cheap Asses.

Mike Cannon-Brookeswas staying at a hotel for $80/night with shared bathrooms. In San Francisco! Atlassian had just done $5 million in sales, was very profitable, and I was scratching my head: where did he find this hotel in San Francisco?

Later on, there was the Famous Scott Farquhar-personally-installed-and-configured Asterisk open source PBX phone system. Installed on this piece of shit server…

… and needless to say, in spite of Scott’s great engineering skills, we swore behind his back and went out and hired a trained consultant to fix the Goddamned thing. In case you wondered, this server is free — first come, first served — if the janitors don’t throw it in the trash bin first.

The printer table was a page in Atlassian History. The table will now go back to the landlord, and while I am a sentimental sap — and looking at this picture brings up some strong emotional feelings — I hope another startup gets this table.

We’re debating at Atlassian what’s the most important metric. Our Chief Metric God and CEO Scott Farquhar thinks Net Promoter score might be it. He has threatened to take a few months off to think about it. While we mere weak-minded mortals spend far less time on metrics, Serious Metric People such as Scotty devote lifetimes of thinking to what to measure and why.

Atlassian’s culture is fun, but it’s also about metrics. So, we decided to start measuring our Net Promoter score. Experts such as Fred Reichheld, a fellow with consultancy Bain & Company claim that companies with high Net Promoter scores far out-perform in growth and have far lower costs of sales. It’s seems intuitive given Net Promoter is all about word of mouth, a subject dear to my heart.

What is a Net Promoter score? Customers are asked “How likely would you be to recommend our product(s) to other people” on a scale of 0 [Never] to 10 [Definitely]? Then you divide the responses:

• Scores of 9 or 10 are promoters; divide the total number by the total surveyed to get a percentage or score.
• Scores of 7 or 8 are not promoters; ignore these responses.
• Scores of 6 or less are detractors; divide the total number by the total surveyed to get a percentage or score.
• Subtract your detractor score from your promoter score to get Net Promoter Score.

How We Stacked Up

We surveyed 500 customers, chosen at random, and our Net Promoter score was: 52%. Although this puts us in great company with the likes of…



… we’re now obsessed with the comments we got back on what we need to fix. Imagine the kind of customer loyalty Harley Davidson has! How does one achieve that?

How We Surveyed Customers

We learned something simply about how to survey. We made it clear we only required answering one question to participate in the survey. The other three questions were entirely optional:

• “If you wish to elaborate on your response, do so here…”
• “Is it OK for us to contact you?”
• “If so, what’s your contact information?”

I felt it important that we reduce the survey to the smallest possible, even to the point of editing out superfluous words so each sentence was concise. I hate surveys that say “This will take 10 minutes” instead of “This survey has 10 questions”. I absolutely hate surveys where I never know when the end is coming. Always state how many questions!

Other Lessons from the Net Promoter Survey

The survey had a 40% response rate, and 20% of the customers said it was OK to contact them. Given how busy people are, we were pretty happy with these statistics, but while these stats compare well in marketing circles, that’s not our goal. Our goal now is understanding what we have to do to get better.

What Are We Doing About it?

First priority is personally calling every single detractor [who agreed to be contacted]. I am again obsessed on this process: one person needs to conduct these calls so the information is properly assimilated and understood. Passing support problems to support and product problems to development loses this vital analysis.

Second we are thanking everyone who participated and is willing to contacted.

Third, we are working out a process for contacting the promoters and the “middle” scores. As this is our first time, we have much to learn, and most important, apply what we hear.

I have decided to go into magazine publishing, I am excited to announce the inaugural issue of Wiki People. I am also excited to announce this is a joint venture with the popular People magazine. Here’s a pre-release copy of the fantastic first issue cover, destined to become a collector’s edition.

A Coffee shop opened on the corner near our office. What they are doing to launch their new business amazingly applies to most companies. It’s brilliant and common sense. The Coffee shop illustrated to me lots of attributes of how to think about starting a new business, and how not to do it…

1. The New, New Thing vs. the Pizza Strategy

Mistake #1 in Silicon Valley is the obsession with the New, New Thing. The opposite is the Pizza Strategy. It’s practical, you could eat it every day (if you work with engineers), it’s both lunch and dinner food. It serves a lot of purpose, but it’s common and a bit boring. Innovation is wonderful, yet not enough technology companies go after crowded industries where an unmet need still lies.

Coffee Bar, which opened last month in our neighborhood is an excellent example of my kind of entrepreneurialism. They opened one block away from Starbucks. People asked why they would do that? Dumb question. Starbucks is an Unholy Blasphemous Sacrilege to those of us religiously devoted to the Sacrament of Coffee.

I call JIRA our Pizza business. It’s the sincerest form of flattery because Mike and Scott chose a software product with tons of competitors yet found an unserved need: a useful, practical issue tracker for $1200 - $4800. Five years later, it still sells like hotcakes. There were lots of pizza shops, but JIRA pizza has a strong following.

2. Marketing vs. Product

It’s not that marketing is bad. Hell, I’m recruiting for a VP Marketing. The question is: what do you lead with? If you can’t win folks with the product first, pack it up.

Coffee Bar has sitting next to their menu a ranking of all the best, generally boutique coffee shops in San Francicso. This takes cojones because San Francisco has some great coffee shops in the North End that are historic with the Beat Generation. Coffee Bar ranks #1. The point is: they are proud of their product and determined to be the best. They lead with Great Product.

Coffee Bar does something else we try to do at Atlassian which is give customers fewer choices, but give them good ones. We apply this rule to pricing to keep things simple. The first time I heard about Coffee Bar’s food, Jonathan Nolen said “The menu is limited but everything is great.” Bullseye. Apple figured this out a long time ago: compare the number of add-on options available on a Mac to those on a Dell. With Dell, the choices are agonizing and confusing.

Lead with product and keep things simple.

3. Free Trials vs. Hassle

What’s the biggest problem with test driving a new car? The hassle from an annoying salesman. Why do software companies do this when all you want is a whitepaper…

Why don’t more companies just let you try their products with the least intrusion and hassle? During lunch when I normally don’t have coffee, Lindsay at Coffee Bar asked me if I wanted to try the coffee for free. Just the act of offering me a free coffee warmed me to the place. When I asked for a double espresso, she said, “Perfect”, because she wanted me to taste the undiluted essence of the core product: coffee. She handed me the espresso with a pride and belief in her product. She expected nothing in return.

The more questions you get asked when you evaluate a product, the more you ought to run for the hills. Businesses need to be willing to trade bad customer information for engendering trust.

4. Marketing vs. Word of Mouth

When I told Lindsay at Coffee Bar lunch was excellent, she asked if I could tell my co-workers. I was more than happy to oblige. Lindsay led with great product, she has visible pride in her restaurant and product, she is happy to be a few feet away from the Starbucks, and she understands my recommendation is much more important than an advertisement.

Ask yourself what can you do to promote word of mouth? Advertising is no longer what it once was.

5. Branding only matters so much

Too many tech and Internet companies obsess over names. Granted, consumer companies have a greater challenge. If you are taking on, say Coca-Cola or Cheerios, I would support an intense effort on naming.

What I like about Coffee Bar is that it is imperfect but it works. It stands for Coffee in the daytime, Bar at night. “Oh, that’s cool”, was my first thought. I’ll remember that. Is it a boring, generic name? Sort of. But so what if the product is excellent, and they concentrate on what customers really want?

There are a few common, useful rules for naming from Rob Gemmell, a friend and Marketing God:

1. Own-able — The name is unique and you can own it. “Accenture is ow-nable; “Pacific Lumber” is not. Any name becomes own-able over time if you either spend a lot of money on marketing, or you establish a large market of customers who know you.
2. Spell-able — The one weakness of the “Atlassian” name. Sometimes related is Pronounceable, which is another Atlassian imperfection.
3. Memorable — Related to uniqueness, but very different: will people remember the name?
4. Relevant — “Reliable Roofing” is highly relevant: it includes the benefit. It is relevant to the customer. “Apple”, on the other hand is completely arbitrary and not relevant. It’s cute, but it’s not relevant to the customer. “International Business Machines” was extremely relevant at the time.

The other two useful, secondary rules are: 1) Start with a letter high in the alphabet, a strength of Atlassian or Apple, and 2) Try to keep it as short as possible.

“Coffee Bar” is imperfect. Once you understand it, it might be memorable. But it is too generic to be own-able, without a lot of marketing money behind it. It doesn’t matter as much as the product, the customer service, the ambiance, and of course, a motivated, smart owner like Lindsay.

Disclaimer: We have not formed a judging committee, I have no idea whether or not I will be on the committee, and the decision could be made by a couple of engineers over a lot of beer in Sydney. These facts do not prevent me from giving you, Dear Reader some valuable insights into this hotly contested competition.

As an employee I am officially disqualified from Atlassian’s T-Shirt competition, which irks me to no end as I would whip everyone’s ass in this competition. Nevertheless, I am compelled to dispense potentially useful information on how you might stand out from the crowd pounding down our doors with spectacular designs and ideas. Here are some possible strategies for you Closet T-Shirt Designers:

Strategy #1: Design something a woman might wear. Being engineers and being men generally, we have a terrible habit of designing things that are questionable when written across a woman’s chest. The original clean, simply designed Confluence T-shirt is one of my favs but as you can see…

This is a risky, breakout strategy as our founders are 28 year-old Australian men and of course, engineers and opinionated at times. But I think the timing is right to do the right thing by women, as Kathy Sierra pointed out a long time ago.

Strategy #2: It’s all about a clever, funny tagline. With this strategy, the design is irrelevant. Take our most coveted JIRA T-shirt. To this day, people love the tagline:

Strategy #3: Get edgy. This is risky as you might go too far. Here’s an example of one of our more recent T-shirts which may have gone too far:

This one may say something about engineers who spend too much time in front of their monitors, but I’ll let you draw your own conclusion.

Strategy #4: Make something retro and timeless. The problem with retro is it is in the eye of the beholder, and I’m not sure there’s anything retro about a 5-year old software company. My favorite example but a really sweet T-shirt is this beauty I got from Ted Leung:

[Disclosure: I used a Newton for 18 months. I still own it.]

Strategy #5: Sex. That’s right. Sex would be a cheap trick but Hey, stooping to the lowest common denominator works often. Here’s Yelp who in a lot of their branding uses some of the same tricks as American Apparel:

Yelp can get a bit frisky with their marketing of their apparel:

Would this cheap tactic work with a bunch of young engineers in Sydney? You decide.

There are three surefire ways to write a bad resume:

1. Make it too long.
2. Obscure your background with your interpretation of your strengths and skills.
3. Give a vague chronology.

Kicking off our search for a VP of Marketing this week made me ruminate about bad resumes. For this role, the problem is that marketing people can make anything look good, or more accurately: they can talk at length about anything, even if it’s irrelevant. So, the primary problem is long resumes that put you to sleep. I thought this a good opportunity to get crabby about resumes in general.

The three best ways to write a bad or a good resume:

1. Length

Most mortals can fit their background on one page. After about ten years of experience, you might merit a second page. Maybe. But think hard first. It might take 15 years before we need to hear it all. I have seen some resumes that creep onto a third page that are well written, but these are people with 20 or more years of experience.

Four pages are uncalled for unless you are from a foreign country where the sheer weight of your resume is part of the Feng Shui and culture. In spite of this habit overseas, it is a practice that is doomed in a world of impatient, ADD Type A’s who spend more and more time on the Internet. Get over it. Practice using that delete key, Champ.

2. Identify Your Background, not Your Skills and Strengths

Let the facts speak for themselves. Nothing is more annoying than resumes that start with a half page or an entire page summarizing someone’s background and skills. Your experience is what counts, not your interpretation. I have seen good resumes that start with three pertinent bullets highlighting key experience, but unless you merit a two or three page resume, try to skip this. Your work history and specific accomplishments are what matters.

Here are two actual examples from resumes I received today:

• “I am a marketing master that can develop unlimited campaign ideas from the fertile right side of my brain.” I kid you not. A Master with a Fertile Brain. Save me.
• “Strengths (Source: Gallup Clifton Strengthsfinder): Maximizer, Ideation, Strategic, Self-Assurance, Activator.” Is this necessary? Aside from being very unclear on what a “Maximizer” exactly is, or for that matter an “Activator”, what God-Help-Me is the Gallup Clifton Strengthsfinder?

3. Specific, Clear Chronology

If you have ever interviewed with Heidrick & Struggles or any of the major executive search firms, you know that competent, highly paid recruiters are exacting about chronology. Even if you are a CEO, these recruiters will carefully go through every crevice, so no stone is unturned.

That means month and year, start and end to every job. Yes, the month matters. It demonstrates you are a concrete, specific person. Remember, this is your career. Here in swashbuckling Silicon Valley where folks go through jobs like hot knives through butter, a string of jobs all less than two years is not uncommon. Therefore the month becomes material.

Always show the year you received a degree. Vagueness can make one wonder what you are hiding. Did you get lost at a Dead concert for a few years? (There’s an appropriate way to describe this career move.)

If you can get these three things right: 1) brevity, 2) background not strengths/skills/functional nonsense, and 3) clear chronology, you are off to good start.

[The Herengracht, the "Gentleman's Canal" - one of the three main canals]

Last week we held our first Atlassian User Group in the Netherlands, marking our 10th user group all-time, and our 7th in Europe. The Netherlands may be only 16 million people and the 23rd ranked worldwide GDP, but it is our 6th largest country in terms of sales.

Accenture was kind to host the event and promote it locally. Michael Widjaja and Nicolas Peeters from Accenture attended and presented. Nicolas talked about Accenture’s best practice development tools, which include JIRA, Confluence, Bamboo, Fisheye, and Crucible. He also talked about how they collaborate on development globally using Confluence. Accenture now has 35,000 consultants worldwide users on Confluence, with use growing rapidly.

The Amsterdam event was striking in that 25% were from the UK. It seems the Brits like to fly over to Amsterdam for meetings. I can’t imagine why. Walking through Amsterdam is one postcard photo after another. Er, because of the the canals of course.

The group was one of the most knowledgeable I’ve encountered, answering each other’s questions at times, which is what a user group should be about. If there was one thing missing, it was having more users present. When I showed the group some public and private wikis and said it was hard tp get screen shots of internal wikis to present, three customers came up and offered me screen shots. That’s what other users want to see, and that must be Dutch hospitality. Bedankt, Amsterdam.

* actually I must admit I didn’t, but Mike Cannon-Brookes did and I was terribly jealous.

The community of inspiration I felt when I blogged about my cancer is still alive. Lance Armstrong just sent me this great note:

My friend Fred Harman happens to be on the board of FRS [stands for Free Radical Scavenger -- which would be a much cooler name -- a great Health Energy drink] with Lance. Fred told Lance about my blog where I talked about telling my kids about my Plan to whip cancer, “The one difference between Lance and me is that I didn’t have to win the Tour de France. I only had to beat cancer.” All true, and one of those truly emotional moments.

Getting this is wonderful and inspirational for me. Lance was one of my attitude inspirations three years ago. When Lance writes “Hang Tough”, you know it’s coming from someone who defines Tough.

And I absolutely _love_ the last three words on the bottom of the card: Attitude is Everything. Check.