Gil Friedrich of Avanan: 5 Things I Wish Someone Told Me Before I Began Leading My Company

An Interview With Jerome Knyszewski

Honestly, I can’t track who gave me bad advice because I don’t attribute the advice to the person that gave it to me. At the end of the day, I made the decision to listen to it. But there’s something one of our investors said to me that I think helps me with all decisions. I pitched a business idea to him on a new way to sell our product and ask him what he thought. He said, “What does it matter what I think, if it works, it works.” It’s an amazing perspective because it means any advice should be taken with a grain of salt. The only thing that matters is to try and see what works.

As part of our series called “5 Things I Wish Someone Told Me Before I Began Leading My Company” I had the pleasure of interviewing Gil Friedrich.

Gil Friedrich brings more than 18 years of development and leadership experience to Avanan. As CEO, Friedrich has overseen rapid growth and a major paradigm shift in the cybersecurity market. Beforehand, Gil served as ForeScout’s VP of R&D and VP of Technology, expanding the company’s technology into mobile security, BYOD policy, and Cloud services. He holds a B.Sc. in Physics and an M.Sc. in Computer Science from Tel-Aviv University.)

Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

All the Avanan founders were working together at a company that was helping companies secure their internal networks. We were very successful, with thousands of customers, but in more and more of our discussions with customers, a theme kept coming up: “We love the technology but we’re moving to the cloud and SaaS.” And the question that kept coming was, how do I implement your technologies in the cloud? As we looked at what the other vendors were doing, we saw that most of them were basically trying to adapt their old technology to the cloud, coming up with cumbersome proxy architectures, while we believed that the future is in API and cloud-to-cloud connectivity. That’s what we’ve done at Avanan.

What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?

There were several aha moments but one of the most important ones was in 2016 to understand that phishing in cloud-based email and specifically Microsoft 365 is a new problem that was already big and was going to be huge. It was also the understanding that hackers focus specifically on compromising Microsoft 365 and are after a different “prize” — compromise the end-user account. Finally, it was the understanding that traditional email security vendors were behind in implementing machine-learning and had an architectural deficiency that left them at a disadvantage to solve the new email security problem, once email was moved to the cloud.

Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?

Giving up was never an option. Even when it was hard, it was always fun. There were two periods that were tough — before take-off and then scaling.

The take-off part is until you get a customer to actually pay for your service. To get beta customers and friendly design partners was relatively easy for us, and during that time, I constantly had this troubling question in my head of, will customers actually be ready to pay for it? By the way, for us at least, the initial beta customers/design partners — none of them became paying customers. Our first paying customers came when we better understood what we were selling and started new trials with the clean understanding of the customer that if they like what they see, they are going to pay for it. That was an important lesson.

The second part was scaling and for different companies, it’s at a different pace. For us, the toughest time was going from about 200 to 500 customers. It was tough because it happened relatively quickly, the product was not yet mature enough and a lot of the infrastructure needed for support, customer success, billing and renewals — all of that was not yet in place. It took a lot of hard work from a lot of people. It felt that we were adding parts of the airplane while we’re already in the air. It wasn’t just good stories, we had unhappy customers that churned and we had employees that left because the pressure was too much. But we came out very strong on the other side and have since reached thousands of customers, now adding 300 customers every month, with an organization that takes care of them, onboards them, and sets them up for success.

So, how are things going today? How did your grit and resilience lead to your eventual success?

Things are going great. Growth is on a great trajectory; we’ve won a number of awards. By grinding at it, working incredibly hard, we’re able to continue to innovate, continue to push our team and continue to make great headway in the market.

What do you think makes your company stand out? Can you share a story?

First and foremost, I think we stand out because we do things differently. We are competing with legacy solutions that were built when enterprise communication was only email and the email server was on-prem. Today email is in the cloud and the collaboration suite is more than just email. Also, A.I. revolutionized our industry and the legacy vendors, though trying to make their way in, cannot achieve the results we get from building a solution with machine-learning at its core.

Customers understand it and don’t want to deploy a legacy solution. No company is building an on-prem data center — instead they are using resources in the cloud. For the same reasons, those companies don’t want to secure those cloud-based environments with legacy technologies that tried to adapt to the cloud. They prefer technologies that were built for the cloud from the ground up.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?

One of the funniest stories is that our original name before we raised money was not Avanan but something else. We went to a seed investor with that name, only to learn that that investor was already invested in another company of almost an identical name, and that company was doing something pretty similar to what we were pitching. The situation was funny because they were a little shocked initially, stopped us pretty quickly and asked us if we knew of the other company. We didn’t, and then they were polite enough to recommend that next time we do a little more homework. Going over the slides at that point didn’t make sense. It was still a friendly conversation, but obviously they did not invest. Funny enough, we became friends and because there was no way they were going to invest, we called them and they helped us with recommendations when we were negotiating our terms with other investors and needed someone from the other side.

Often leaders are asked to share the best advice they received. But let’s reverse the question. Can you share a story about advice you’ve received that you now wish you never followed?

Honestly, I can’t track who gave me bad advice because I don’t attribute the advice to the person that gave it to me. At the end of the day, I made the decision to listen to it. But there’s something one of our investors said to me that I think helps me with all decisions. I pitched a business idea to him on a new way to sell our product and ask him what he thought. He said, “What does it matter what I think, if it works, it works.” It’s an amazing perspective because it means any advice should be taken with a grain of salt. The only thing that matters is to try and see what works.

You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?

I think the key one for me has been understanding our market, the problem we solve and our competition. Together with understanding our engineering skills, it allows us to focus our development efforts, in innovation and a competitive advantage that solves our customer problems better than others. Being able to find a simple solution, without over-engineering, an extreme focus on the customer and the problem, is what allowed us to compete with companies that had engineering teams 20x bigger than ours.

The other thing is how to manage disciplines you have very little knowledge about. For me, this was sales, marketing and financing. I came from an engineering background and knew very little about how to sell our product, or how a company finances work. I learned a lot through the experience but I still have a lot of gaps. Finding the right people is key, people you can trust. Also, finding the right balance of not standing in your team’s way, while still making sure you understand the plan. In the end, it came down to common sense and gradually developing an intuition of what’s more likely to work.

Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?

One of my secrets is that I gamify it all. The goal of the game is to make as many happy customers as possible. Our competitors are the other teams and the market is our league. If we’re winning more often than we’re losing — then we are at the top. When we beat the multi-billion companies in our market, there’s extra satisfaction, and by doing so time and again, we are claiming our spot at the top. There’s offense — finding new customers — and defense, making sure our existing customers are happy and using the product to its full capabilities. We constantly analyze our victories and defeats, all to come stronger for the next game. Sometimes during the game we’re overwhelmed or tired, sometimes we lose, but I personally enjoy the contest regardless of the outcome, and celebrate every win.

I don’t know if this is a recommendation but I can only share it as my way of enjoying the path, and also not taking things too seriously.

What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?

I think a common mistake is not thinking enough about what it would mean to actually sell the product you’re working on. There’s a little bit of an over-glorification in starting a new start-up and I think for many they don’t think enough about how big is the problem they are going to solve, how are they going to find customers, what is going to be their differentiation, etc. We made that mistake for sure, and it turned out OK, most likely because we were lucky and because we were able to pivot around the initial concept until we found the right problem, but if and when I start over again, I will definitely spend more time answering those fundamental questions to make sure I’m starting off in the right direction.

In your experience, which aspect of running a company tends to be most underestimated? Can you explain or give an example?

I definitely underestimated the workload, not just from a number of hours perspective, but the mental load involved in the day-to-day. It might be my management style but I’m very involved in a lot of details, especially product-related. I’m also the ultimate escalation point for many customer issues and I’m often called into sales calls when our team thinks I can make a difference. So, I could try to provide feedback on the new screen design, while trying to figure out how the next financing round should look like, or while negotiating a term sheet with an investor or a buyer. I think that many people require a little of your time, you definitely want to be involved in those critical junctions, you also don’t want to be a bottleneck, and all of this together, at least for me, makes me run at my full mental capacity. I don’t know that it’s underestimated, but I couldn’t predict how it would be until I got there.

Ok super. Here is the main question of our interview. What are your “5 Things I Wish Someone Told Me Before I Began Leading My Company”? Please share a story or an example for each.

1. Figure out, really figure out, that you can sell your product and that it has enough market. Don’t be over-optimistic and don’t fall in love with the idea of starting a company, because if it’s a bad idea you’ll waste time, energy and credibility that you could have spent on a good idea. You might still be able to pivot and find the right one after you start, but it will cost you time and dilution. It’s better to start with more conviction in what you’re going to do.
2. Focus 100% on the market and product — everything else, find someone else to do. For example, get a CFO / VP of Finance very early — she or he will help you manage a lot of aspects of the company that will otherwise suck your time and will not have a critical impact on the success.
3. Make sure to have a great founding group with you. This is the group that will run with you and set the tone for the rest of the company as it builds up.
4. Building the team is critical and you should be very involved in attracting the right people to your team. Strong founders will attract strong employees that will bring other strong people, etc. Therefore, getting an HR manager early will pay off. She or he will build a hiring process and make sure the employees get what they need to succeed.
5. Your family — spouse, children, parents, siblings, and your friends — all will get very little of you in the first few years and probably beyond. Make sure you have their support, especially your spouse, make sure you’re ready for it, and make sure you find ways to balance it, spend time with them and still be there for them.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I’m a tech guy. And I’ve witnessed my kids doing remote schooling for a large part of this year. So having that unique vantage point has been interesting and I definitely think there needs to be much more emphasis on math and computer science. Oddly enough, COVID and remote school forced kids to use a computer to do complex tasks. This is so important and it’s unfortunate that it took COVID for it to happen. I’d really like to see more gamification. My kids got to use platforms this past year where it was all gamified — and they really enjoyed it. We need more of that, especially as students return to in-person school.

How can our readers further follow you online?

You can visit our website at avanan.com or on Twitter and LinkedIn. Additionally, you can follow my personal LinkedIn.

This was very inspiring. Thank you so much for the time you spent with this!

As part of our series called “5 Things I Wish Someone Told Me Before I Began Leading My Company” I had the pleasure of interviewing Gil Friedrich.

Gil Friedrich brings more than 18 years of development and leadership experience to Avanan. As CEO, Friedrich has overseen rapid growth and a major paradigm shift in the cybersecurity market. Beforehand, Gil served as ForeScout’s VP of R&D and VP of Technology, expanding the company’s technology into mobile security, BYOD policy, and Cloud services. He holds a B.Sc. in Physics and an M.Sc. in Computer Science from Tel-Aviv University.