One of the oldest cliches in the book is that if you can win at team sports, you can win at business too. You don’t have to look much farther than the spectacular failure of former Red Sox pitcher Kurt Schilling’s 38 Studios to know that this truism is not always true.
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But sometimes it is true. One such case is San Mateo, Calif.-based DataStax, “the company behind [open source database] Apache Cassandra. We deliver the always on NoSQL database that allows you to have your data anywhere, everywhere, all the time — scaling to previously unimaginable levels,” claimed DataStax CEO Billy Bosworth in a January 2 interview.
And five lessons from this successful sports-star-led startup are worth heeding.
Bosworth is a football player from Pittsburgh who played on the University of Kentucky football team while studying computer science, coached high school football for 13 years, worked in Dallas at Quest Systems as relational database management systems database administrator – forming a partnership with DataStax, and in May 2011 joined DataStax as CEO when it had 19 people.
DataStax has been growing fast since — having raised nearly $84 million in venture capital. Explained Bosworth, “After I became CEO, the company ended 2011 with 26 people; ended 2012 with 81; and we now have 170. My vision for DataStax was simple — you cannot build today’s applications on 25 year old technology from Oracle. We support an open source database, Cassandra, that has the scalability and availability that today’s applications required.”
DataStax has added customers at a rapid clip — and they are among the biggest and most complex enterprises in the world. “In 2011, we had around 20 customers and now we have over 300 — including NetFlix and eBay. Other customers don’t want to say they are using our product because they see it as a competitive advantage.” noted Bosworth.
DataStax is growing because it helps big companies run their operations without interruptions — even if their servers go down in a part of the world. Said Bosworth, “What we do is make sure that their service never goes down — even if a Hurricane Sandy knocks out a company’s servers, we keep the service running with barely a blip by shifting its operation to servers.”
DataStax makes money in a way that is common for open source companies — it sells an enterprise-strength version. According to Bosworth, “We are a strong supporter of the open source community. And we sell DataStax Enterprise which is a fully vetted and tested enterprise grade version of Cassandra with security, manageability, and mixed workload capacity. We charge customers a subscription fee based on the number of nodes per year that use the product.”
Here are the five ways that Bosworth has managed DataStax’s growth.
1. Teaming with the founders
Sometimes a startup’s cofounders have a great product idea and good sales person but they lack the skills needed to grow the company. Chances are that the startup would be better off if it could keep the founders and bring in a new CEO who has what it takes to scale the venture.
That’s what Bosworth did when he joined DataStax. As he said, “DataStax was founded in April 2012 and I arrived 13 months later. I had partnered with DataStax and after nine months they asked me to join as CEO. Matt Pfeii was the CEO and he loved working with customers while Jon Ellis was chief technology officer. Neither was interested in administrative and operational requirements so I came in to provide that. And I am happy to say that we are now partners in running the company.”
2. Proving the product concept
Once a CEO takes charge of a startup, it will only grow if it can convince a customer to use the product. That customer will only benefit the startup if the product delivers what I call a quantum value leap — e.g., it works better than anything else on the market and its price is right. If that customer then refers the startup to others, then its growth trajectory can begin.
DataStax did this by shifting its focus to listening to customers. Bosworth explained, “We were able to get a critical mass of feedback. We listened to people externally whereas before our internal technical people had been shooting from the hip.”
3. Finding the business model
Once a startup develops a product that a customer finds valuable, it starts to grow. And growing often means adding people with skills other than engineering and sales — such as marketing, human resources, and finance. For a startup to keep functioning effectively at this stage, everyone must understand what others are doing and how they fit.
For that, DataStax needed to learn how to operate a distributed company – hiring the best talent and letting those people live and work where they want. He explained, “I had to figure out how to run meetings so that the person in Akron had the same experience as the people in San Mateo. So when we had all-company meetings, I ran them out of my office with nobody else there and we did it on chat so there would be an electronic record of everything that was said.”
4. Scaling the business
Once a startup gets a solid base of customers, growth can come from expanding geographically and/or adding new product lines. Saying ‘yes’ to the right expansion bets and ‘no’ to the wrong ones is vital.
Bosworth said ‘no’ to expansion opportunities that were not consistent with DataStax’s core competencies and ‘yes’ to geographic expansion. DataStax has opened offices in Europe, the Middle East, and Africa. And it plans to expand to Latin America and Asia.
Bosworth also believes it’s critical to hire an executive team that can coach leaders who report to them. Using a sports analogy, Bosworth noted, “A star athlete who becomes a coach will either be very successful or go down in flames. It all depends on whether they can coach coaches, rather than players. To succeed, they need to know enough about the product to make common sense decisions — but the key thing is whether they can pick the right people for the right job.”
5. Setting goals and creating culture
It is important once a startup has grown to a certain size that everyone understands why they are there. Each person must understand the direction that the startup is heading and how their work helps realize this vision. And they must understand what behavior the startup considers most valuable.
Bosworth has clear ideas about both. “We have our Big Hairy Audacious Goals — they are aggressive and take a lot of effort. And we have sub-goals which are about what I am doing today that will take me closer to that vision. And we have specific traits that DataStax values — distributed, visibility, innovative, customer-first, and respect. I want our culture to attract people who like those values and repel people who don’t.