Nearly every company I know wants to have customer service excellence. You may look at brands like The Ritz-Carlton or Zappos to model what real customer service excellence is. The truth is it is not technology or even flawless processes. The secret to customer service excellence is putting employees first. My guest today is Matt Watson, CEO of Stackify. His company was ranked #379 in the 2019 Inc 5000 list. We look at what customer service excellence is. Matt and I talk about why putting employees first is what drives customer service excellence.
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Matt Watson: The Transcript
Target Audience: Matt Watson is a Founder at Stackify & Full Scale. Stackify solves this problem by combining application performance monitoring (APM) with server monitoring, app metrics, advanced error tracking, and log management in a single easy to use platform for developers.
I think the number of jobs that we create, I mean, as an entrepreneur, I think that’s one of the ways that ultimately I like to keep score is how many jobs did we create? Not How much money did we raise and some of these other superficial numbers? I love it, how many opportunities and careers that we help build families that we feed, I think that’s a great way to look at it.
Welcome to Growth Think Tank. This is the one and only place where you will get insight from the founders and the CEOs of the fastest-growing privately held companies. I am the host. My name is Gene Hammett. I hope leaders and their teams navigate the defining moments of their growth. Are you ready to grow?
Gene Hammett [0:47]
Leading a team through fast growth takes a lot of things going well for you. It’s more than marketing and sales and customer service and operations. It really takes a focus on building the right team. We’re going to be talking today about You know, how do you continue to grow? How do you create customer service excellence, but we’re going to be talking about through the lens of leadership, I really believe that we must put our employees first we must, you know, really take time as leaders to create a space for them to grow at the optimal level to empower them, to help them feel that sense of ownership. This is just another interview in the series with fast growth leaders. We’re talking with Matt Watson today. He is the founder CEO of Stackify. We’re number #320 on the inkless in 2019, and we’re going to be talking about why he puts employees first and what that means toward customer service. And the newsflash here is he gets more out of his employees, they put the customer first because they are taken care of. They love the work that they’re doing. And he’s in a very competitive market. So if you can do it in this market, you can do it in any market. I’ve truly believed that.
Gene Hammett [1:53]
Thanks for tuning in here to Growth Think Tank. Really excited about sharing this with you and before you run, I have done so many interviews in the last few weeks, I have such an exciting time to share with you those interviews have been organized into the 12 core principles of fast-growth companies. So all you have to do to get that is going to genehammett.com/worksheet. So you can get the 12 principles, and I’ve been able to go in there and find which episodes will align with each individual episode. When you subscribe to Growth Think Tank, you will find exactly what you need so that you can move forward. And many of them haven’t been published yet, depending on when you’re hearing this. But you can tune in to the date that means the most to you.
Gene Hammett [2:35]
Hey, Matt, how are you?
Matt Watson [2:36]
Hey, how’s it going?
Gene Hammett [2:38]
Well, excited to have you here at Growth Think Tank I’d love for you Let our audience know a little bit about what Stackify is and what you guys are up to.
Matt Watson [2:45]
Yeah, so I founded Stackify in 2012. Before that, I was the CTO of another high growth software company. And the goal was really just to build a set of tools to help other software developers understand how to Applications are performing. Which, if if you’ve ever done the thing with software, you know that software never works the right way. Software is very difficult to build. And the more you change it, the more you break it. You know, it’s a never-ending joke, right? But our goal was to build a set of tools to help developers understand why their software doesn’t work, how to troubleshoot those kinds of problems. So we live in a space called application performance management or application performance monitoring. We compete with companies like New Relic, Appdynamics, Dinah trace those types of companies.
Gene Hammett [3:34]
Well, that helps us put some context to this. I’ve already talked to the audience a little bit about you as a leader and a founder of this company driving fast growth. When you think about fast growth, what are you most proud of beyond just you know, revenue?
Matt Watson [3:49]
You know, I think the number of jobs that we create, I mean, as an entrepreneur, I think that’s one of the ways that ultimately I like to keep score as you know how many jobs that we create How much money did we raise? You know, and some of these other superficial numbers? I love it, how many are opportunities and careers that we help build? families? Did we feed? I think that’s a great way to look at it.
Gene Hammett [4:12]
Well, I know that one of the things I hear a lot of founders talk about mostly is Yeah, the numbers are good, the revenue creates an opportunity, but creating the team that you have, it’s got to be pretty rewarding.
Matt Watson [4:26]
Yeah, and having fun along the way. Right. It’s all about the team. And you know, the team always wants to know if you’re winning or losing. And it’s all about building the right team keeping them happy. And it can be very difficult to attract top talent and retain top talent. I mean that’s our biggest struggle as a company.
Gene Hammett [4:46]
Well, I talked to a lot of founders just like you on this podcast because we focused on the Inc 500 and they don’t typically have that much problem with retention is Is it more Did you have any struggles with retention?
Matt Watson [5:00]
I think anybody who hires software developers has a big problem with it, right? Most software developers don’t stay at the same job more than one to three years. You know, it’s not like you hire them. And 30 years later, they retire from that job. I mean the job, they jump around a lot. And what most people don’t realize if you don’t work in it, if you’re a software developer that’s got a few years experience, you know, working on, you know, late, newer technology, you get recruited by it recruiters, literally every single day, every day. The employees that work for me, I know get recruited to try and leave every single day by an IT recruiter. Because there’s such a lack of talent out there, right there. I mean, in Kansas City alone, or in Kansas City, there, I think there’s like over 1000 open it jobs, right. So they’re big companies and recruiters trying to steal my employees every single day.
Gene Hammett [5:56]
Well, that’s probably one reason why you have the perspective. You have because I’ve asked a lot of leaders, the big question that really drives a lot of my work is, you know, as a leader, what’s more, important to your customers or employees?
Matt Watson [6:10]
And it’s got to be employees without employees, you have nothing.
Gene Hammett [6:14]
When you think about putting your employees first, what does that mean to you as a leader?
Mason Arnold [6:19]
It’s making this an interesting place for them to work a place, they want to work, taking good care of them. They’re all free agents, they can all leave any day, right? Especially, you know, this is especially true for the software developers that are in such high, high demand, but it but it’s for all employees, right? They all have other opportunities that they could go do. Other places, they could go work and we’re lucky enough to have them here, right? So we have to provide a good workplace for them, provide them interesting work. challenge them to provide career growth, all those things, right. And those are all complicated things as a business owner to actually do, but they’re really important.
Hold on for a second. Matches talked about putting in employees first. Now that may be counterintuitive to you as a leader because you’ve been taught that in your marketing and sales, you must put the customer first, let me be clear here, the company must put the customer first the company must serve the customers provide value, and they must, you know, really take that seriously. But a leader must create a team that is connected together and feels a sense of ownership. If you’ve heard me talk about this before, you may tune out here because nine out of 10 actually it’s closer to 94% of leaders of fast-growth companies believe it’s an employee first. I share that data with you because it really is a you know, counterintuitive to what a lot of people think about growing the company. They focus on strategies and tactics. And they hope that the people will come along for the ride, what I believe in my heart as a leader that you want to really focus on The people grow those people, empower them, have them create that sense and feeling of ownership. And they will treat your customers with excellence, they will create the strategies and the systems that drive the company forward, whether they be higher revenue, whether it be, you know, market share, or maybe it’s making the world a better place. The employee first is a way to go back to the interview.
Gene Hammett [8:04]
Now a lot of people get that poll question twisted because they may say that you know, everyone says you have to have customers do you have revenue in your company you wouldn’t grow fast, you didn’t have revenue. One of the things that when we talked last week Matt, you really put a value on customer service. What is so important about customer service in your world?
Matt Watson [7:22]
Well, from any kind of sass company, a software company, one of the most important metrics you have to track is churned, right? Its churn and conversion rate, and how good a job you do it, customer service, account management, sales, all of those sorts of things directly related to the conversion rate of new accounts and churn and expansion. I mean, those are all three very important metrics that are all very influenced by how good a job you do have customer service. I mean, the product has to work right. People have to like the product has to solve a problem like all those things are important. Customer service account management, all those things really make a big difference.
Gene Hammett [9:22]
And in your world, it’s a little bit harder, because you put actual engineers and technologists on the front line of customer service. Why do you have to do that?
Matt Watson [9:33]
Well, as I mentioned, our customers or other software developers, our product is very technical. You know, we have to support six different programming languages on Azure and AWS and Kubernetes and Docker and all this technology bingo, right? And so our customers ask a lot of complicated questions are like, I have this Node JS application with AWS farmgate on Kubernetes with Blah, blah, blah, blah, blah. Why doesn’t it work? Like how should I know? Right? It’s complicated. So yeah, we have to hire support engineers, software developers to help support our product. So and our customers need answers quickly. And that’s one of the ways we differentiate ourselves is a lot of our competitors take 24 to 48 hours to respond to customer service requests. On average, we respond within 30 minutes. Our goals and our so our team responds to most support issues within 30 minutes, which is huge. I mean, that’s like an industry-leading type response rate.
Gene Hammett [10:41]
You may be aware of this. And it’s not a test but Richard Branson’s famous for saying that customers did not come first. employees come first. If you take care of your employees, they will take care of your clients. Have you did you model what you’re doing after that? Or did you just see that’s the way you have to create the business putting in place first?
Matt Watson [11:02]
For me, I think it’s just common sense that employees are critical to everything we do, right? I mean, the, as a startup, you’ve got to hire smart people, people that are adaptable that can grow with the business, you’ve got to train them. Right? And it’s very expensive to hire people train them the amount of effort that it takes, you know, to invest in somebody, right? When, you know, when you got 50 people in a call center, you can hire number 51. And somehow those other 50 can through osmosis train number 51, right. But in a small business, when when you hire a new director of sales or whatever, all of a sudden, that’s, you know, spend an enormous amount of time training that one person because you have such a small team, so you invest a lot in people, so you got to hire the right people, and you got to retain them.
Gene Hammett [11:51]
Well, I want to dive into this because, you know, putting in place versus is is a good kind of mantra, but what are some of the steps that you’ve actually done? Over the years as a leader to put in place first,
Matt Watson [12:04]
It goes back to creating a good work environment for them. The benefits that we provide them the little perks that provide them, right just the all the little things, I think add up. I don’t know that that’s necessarily any giant thing. It’s just all the little things that you can do to make it a great place to work.
Gene Hammett [12:27]
Have you ever worked at a place that wasn’t a great place?
Matt Watson [12:32]
I have, well, probably my first. Well, I’m an entrepreneur. So I’m unemployable at this point. You know, I’ve, I’ve owned my own business now for over 16 years. So it’s hard to even think about working for somebody else at this point. But the first one of the first jobs I had was a pretty terrible place to work, but I did my job and ground through it. But yeah.
Gene Hammett [12:58]
which you know, I’m not gonna ask you to spill now. But if you had employees that just did their job and ground, do it, you probably wouldn’t have grown the way you have.
Matt Watson [13:07]
You know, sometimes that’s what you need your employees to do, though, right is, I mean, you need them to do their job and stay focused, right? That doesn’t mean they don’t enjoy what they do. But sometimes, you know, the startup world is just a grind it and that is the reality of it too, though, is there’s just work to be done and we got to stay focused and do it.
Gene Hammett [13:30]
Well, when I say this, when and the work I have, and you can kind of chime in if you want to have to go beyond that sense of grind, right? You have to there’s when you have people, I’m sure you have people in your team that is truly connected to the work, they show up with more creativity and energy. They’re looking to solve problems that aren’t identified yet. And those are the ones that are you know, you’re trying to hold on and maintain to when you think about that, I call that creating a sense of ownership, right? People have that sense of ownership, how important has that been for your company?
Matt Watson [14:05]
It’s very important, especially in our engineering team, and then having ownership around, you know, the system performing well that it works, that when we find problems that they actually solve the problems, right, you know, building thoughtful and well-designed features into the product, all that stuff, right? You need people to have ownership of those things. I was talking to one of my developers the other day, and, you know, he was just talking about how fortunate is he is to work for us because, you know, not every day you find this type of company to work for. Most people don’t a lot of people that work in software development, don’t work for product companies. So they work at an insurance company or a bank or whatever, where software is just an operational expense for them. It’s just something they do. So for a lot of software developers, it’s a great joy to work for a company like Stackify, where our product is a software product. So that definitely helps us with recruiting and people like working for us for you know, partly for that reason as well.
One second here, Matt just talked about, you know, creating a sense of ownership. I know I asked the question, but I want you to understand what I mean by the sense of ownership. After doing hundreds of interviews with fast growth leaders, just like yourself, I have looked at what creates this kind of culture where people are willing to empower themselves and transform who they are, and trust the process and trust each other as team members. And they had that feeling of ownership. I’ve created a model that really think that you could learn a lot from it’s called the fast growth model. That model will teach you what you can learn and how to put the pieces together as a leader to create faster growth. This is not about your marketing plan or sales plan. This is about your people’s plan. This is about how you are showing up as a leader. It’s about how your team shows up. And it’s how you execute and take your strategies to the next level, I’m going to share with you some of the insights behind it, you’ll be able to take that into the next level inside your company. And you will be able to get all the pieces together working together in alignment. Just go to the fastgrowthmodel.com, you can get more training on that. Now back to the interview.
Gene Hammett [16:29]
Matt, I want to take you in into a little bit different direction and really kind of peek into the journey here. What one mistake comes out as one of those things, it was something maybe even painful that you had to go through but it actually what provided a breakthrough for your own leadership.
Matt Watson [16:47]
Well, I think in the early days, it was probably putting too much emphasis on sales and not enough emphasis on support. You know, when we had early stages of the product, we thought we were ready to go out there and sell it and kind of prematurely? You know, hired salespeople didn’t really have a product to sell. I mean, I think that was, that was one of the hard lessons we had in the early days is that the product wasn’t ready for you to go hire an expensive salesperson to go sell something that’s not ready to be sold.
Gene Hammett [17:21]
I can see how that causes a lot of problems, especially in your world where you’re you got to serve them after the fact.
Matt Watson [17:27]
Yeah, I mean, it’s a double-edged sword because you also want to get out and talk to customers get their feedback, right. Improve the product, try and sell the product right obviously I mean that’s another mistake some people make is they never actually try and sell something it’s there’s a fine line there somewhere.
Gene Hammett [17:44]
Reid Hoffman’s famous for saying that if your first version is not embarrassing, then you’ve probably waited too long.
Matt Watson [17:51]
Yeah, yeah, for sure.
Gene Hammett [17:54]
When you think about defining moments within your leadership, what comes to mind my
Matt Watson [18:01]
One of the biggest struggles we had was marketing to our audience. Our customers are software developers, right? They don’t have phones, they don’t answer the phone. They all use ad blockers. They all hate spam. They all hate marketing. They all a lot of them were, you know, tinfoil hats. And they’re cynical about the world that this is kind of the personality, right? So it’s trying to figure out how to market to them. And so that was one of the most difficult things for us is we built this product. We’re like, Oh, yeah, software developers are going to love this. And then come to the realization of like, how do we get them to know that we exist, because they hate all forms of marketing, and they don’t like to talk to people. Right. And so that was one of our biggest struggles in the early days of this. And then eventually, we figured out how to reach that audience and we do a very good job of it now. But that was one of the defining moments. That was very difficult.
Gene Hammett [19:01]
Well, I know we talked about this a few weeks ago, but I want to dive into it because we can’t leave the audience just hanging. You’re a big believer and in creating content that serves your market and brings them in, tell us a little bit about your approach, and then how you put together the strategy.
Matt Watson [19:19]
Yeah, so we, you know, we definitely embrace it. There’s one universal truth in this world. And this definitely applies to software developers, if they don’t know how to do something, something doesn’t work that questions right. They go to Google, and they search for it. And so we put a big focus on content marketing, our website gets about a million website, visitors a month, from the content marketing we do, which is a lot, right. If you had to pay $1 per click, you know, advertising to get that amount of traffic like it would be absurdly expensive. So the content marketing that we do really drives all of our business. And we also decided to build a free tool because developers love freedom. tools. So we have a free tool that we build that drives a lot of interest and traffic as well.
Gene Hammett [20:08]
Well, when you think about that strategy, did you do it in the house? Did you hire an agency mixture of both?
Matt Watson [20:16]
Well, we earlier we were talking about books and actually there’s a book called traction. I don’t remember who wrote it, but it’s about different traction channels and anybody out there Oh, look at that. Any anybody out there who based on the video, he’s holding up the video, the book. Anybody who’s trying to figure out their go-to-market strategies, I really recommend that book or just googling about the topic and getting the list of different traction channels. Because there are so many different ways to market your business. from things like I mentioned, engineering as marketing was the free tool is what they call that I think in the book, content marketing or traditional advertising or speaking or doing a podcast writing books or all these different kinds of forms of go to market traction channels. And, you know, we went through the list of traction channels and said, You know what, we’ve had the most success with these two and had the least success with the ease and, and that’s how we landed on doing content marketing and the free tool that we built was from the book.
Gene Hammett [21:21]
Now, did you do this completely internal?
Matt Watson [21:24]
Gene Hammett [21:26]
So you’ve built a team around the creates the content, puts it out into the world just distributes it in different ways. And I bet that team’s pretty valuable to you now.
Matt Watson [21:36]
Well, so actually, the content marketing side of it, we actually use a lot of freelance writers. Okay. So, and that’s probably because our content is so technical, you know, for me to say I need someone to write an article about how to deploy a Ruby application to AWS with Kubernetes or whatever. I can’t hire enough people to be you know, x really skilled and all those things. So we rely on some freelance writers to help do it.
Gene Hammett [22:06]
Fantastic. Well, Matt, this pretty much is the interview, I want to kind of go back to this whole employee. First thing if you had to sum it up and just a small statement of leaders that are looking at this employee first, what would you say them?
Matt Watson [22:21]
You know, I think it’s obvious to most people that employees are your most valuable asset. Especially these days, if you’re working in technology, and you have software developers, they are free agents that are highly recruited every single day to go work somewhere else. And you’ve got to take really good care of them, give them interesting work to do. And just know that they’re being recruited away at all times. And so you, they’re sort of the quarterbacks of your company, and you don’t want to lose them when you’ve got really good ones.
Gene Hammett [22:53]
Well, this wraps up this episode with Matt talking about employee first it actually drives me excellent customer service. So thanks for tuning in here at Growth Think Tank.
Matt Watson [23:04]
Gene Hammett [23:05]
Well, thanks for tuning in to Growth Think Tank. I love interviews like this, where it’s just another data point about how important it is to put in place. First, you want to grow your company fast. You don’t focus on strategies and tactics, you focus on the people who create an environment where they can excel and really bring creativity and innovation to this. They think for themselves, they’re empowered. That feeling creates that sense of ownership. All of these interviews are linked together on that core idea. So hopefully, as a leader, you’re taking what you’re learning, you’re applying it to your business, and you’re moving to the next level. As always, lead with courage. We’ll see you next time.
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