Founder’s Fireside: TransferWise & Ustream
Wednesday evening, Mosaik had the pleasure of welcoming two of our heroes, Ustream Co-Founder & CTO Gyula Fehér and TransferWise Co-Founder and CEO Taavet Hinrikus, to a packed house and fireside chat.
The evening’s moderator, Mosaik’s own Csongor Biás, covered a lot of ground over the course of an hour, grilling Taavet and Gyula on everything from startup learnings to company culture to local ecosystems.
Buzzing from inspiration and Techfröccs induced hazy memories, we’ve put our top takeaways from the event together and sprinkled in a few of our favorite pics from the night. Thanks for coming out!
On lessons learned building a startup
Both TransferWise founders got their startup education as early employees in the then-budding Estonian startup success Skype. In fact, Taavet was actually Skype’s very first employee at its inception in 2003.
Having that first startup experience was crucial in instilling a ‘customer-first’ mindset in Taavet’s and co-founder Kristo Käärmann’s current team, and thanks to that they’ve put a massive emphasis on team>ego in their current business’s recruitment structure.
Even now, as the company employs over 600 people globally (and are hiring here in Budapest!), the TransferWise team is incredibly selective, hiring for motivated, “hands-on” individuals that are ready to get the job done.
“Culture is easy to screw up, but difficult to fix.”
Building Ustream taught Gyula a big lesson about company culture, i.e. that “culture is easy to screw up, but difficult to fix.” The early days of Ustream put little emphasis on creating an articulated culture, leading to a harmful mindset stemming from the team. When the company started scaling, new hires weren’t met with a cohesive and aligned organization able to properly onboard them to the project.
Gyula admits that course correcting the set culture was a challenge that almost spelled the early demise of Ustream, but they pulled through and he came out with having learnt a valuable lesson in the ‘soft fluffy things.’
On the early days of uncertainty and the tipping point
As most people running in the startup world know, everything about starting a startup is uncertain. “There’s no way you can know unless you try,” Taavet simplified for the crowd.
Two major uncertainties the TransferWise team faced down were around gaining traction, and turning their first TechCrunch-reading-early-adopter momentum into a viral loop of retention. The second was around recruitment, and the struggle to attract talent to a business with an excruciatingly short potential runway of just five months.
Gyula detailed the genesis story of Ustream and their early days of intense uncertainty spent thinking way outside of the box to get traction for their barebones MVP. After a failed stint live streaming celebrity spottings in LA, the founders found success convincing early tech adopters to use the product, and even live streamed the Diplomat’s own Freeky Zeeky during his album launch campaign.
The light at the end of the tunnel that got them through? Celebrating increasingly more momentous events streamed via Ustream, including both of President Obama’s inaugurations.
On company culture and recruiting talent
TransferWise credits its recruitment success to having a mission that resonates (financial services are broken and someone needs to fix the problem), and a culture of ‘getting shit done.’
A commitment to debriefing everyone on ‘the bigger picture,’ and a workflow that operates on feedback from the front lines, from those directly working with the customers, means the team can work fast and smart.
The Ustream culture revolves around doing something as you would want it to be done, being a straight talker and asking the hard questions. Gyula’s main observation about company values? The culture stems from the tone that the leaders in the business define, and it’s not about what you write, it’s about what you exhibit and act on as a founder.
On preserving culture at scale
Ustream’s early 2016 acquisition by IBM won them a lot of doomsaying messages from headhunters predicting the demise of ‘Ustream as we know it.’ However, despite the pessimistic forecasts, Ustream was able to preserve their autonomy and unique culture in the IBM behemoth, and is even teaching the giant a thing or two about agile workflows.
As a company with ‘IBM Lab status,’ the Ustream team has a special role in the R&D hierarchy. The biggest upshot of the deal is the opportunity to tap into IBM’s vast resources and talent pool.
On Estonia’s startup ecosystem
As Taavet puts it, the globally renowned Estonian startup ecosystem is a product of both historical and current events. The Soviet occupation left a legacy of strong education in STEM subjects and a DIY approach to getting what you want.
Estonian born success stories like Skype, GrabCad and now TransferWise have gone far in legitimizing the ‘uncertain’ nature of startup life to the mainstream. These companies provide employees with invaluable know-how and capital, and inevitably a portion of that funnels into the birth of new startups.
99% of Estonians pay their taxes online.
The cherry on top stems from the Estonian government, that has professed that it will also ‘run the country like a startup.’ Their commitment to digitalization has led to impressive stats like 99% of the population paying taxes online, and to a national familiarity and tendency towards supporting digital innovation.
On Budapest
TW’s recently opened Budapest office was attracted to the city’s increasing attractiveness for young people from all over the world, and the potential to attract strong talent from established industries into a startup environment.
Aside from Gyula’s personal love for his home country, the decision for Ustream to stay in Budapest was based on the size and quality of the talent pool, the attractiveness of the Ustream story and the operative environment.
While operations may not be a Sunday stroll within local regulations, Ustream got a good deal in the other two categories. Even in the budding livestream days of 2006, there were many Hungarian developers well-versed in the technology and attracted to the Ustream mission.
And unlike the mind-boggling churn typical of developers in Silicon Valley, in a place like Budapest companies benefit from attracting employees for a much longer tenure.
On what’s next
The TW story is just beginning, and Taavet laid out some of the startup’s objectives that will ‘keep them busy for a little while.’ TranferWise is working on growing their 5% UK market share to 15–20%, and gaining a 5% market share foothold in each country beyond that.
Small and medium sized businesses sick of being underserved and overcharged can look forward to using transparent TransferWise services, and the company has even partnered with a few select banks to allow account holders to use TransferWise services.
On the aftermath
Between the wise words of advice from both founders and Gyula’s rye sense of humor, the inspiring and dare-I-say entertaining event had us all feeling pretty pumped about startup life.
The ensuing Techfröccs party gave us all a chance to digest and wind down from the day’s happenings, with a wine spritzer at hand and a room full of formidable foosball and ping-pong players to challenge.
Until next time! Make sure to check out more upcoming epic events right here.
