How to Unleash the Power of Your Developers According to Jeff Lawson, CEO of Twilio
With 9 years of the NY Enterprise Tech Meetup (NYETM) under our belt, we’re excited to continue our epic speaker lineup of enterprise game changers. First up this month, Elizabeth Lawler, CEO and Co-Founder of our portfolio company AppLand demoed their new, open source product AppMap. Then, we dug into a fireside chat with Jeff Lawson, CEO and Co-Founder of cloud communications platform Twilio.
Today, Twilio is among the world’s five fastest growing tech companies with a valuation that has tripled since the onset of the pandemic in March 2020, with more than 200,000 customers, eight million developers, and over $2 billion in ARR. Not only has Jeff been busy growing Twilio, but his new book, Ask Your Developer, is hot off the press and we double clicked on how Twilio created a developer-led culture paramount in closing customers and the company’s rapid growth.
As we got talking to Jeff, we realized that Twilio’s core philosophy sounded a lot like our own:
Tap into customer pain points first, and only then can you successfully build (in Twilio’s case) or invest in (in Work-Bench’s case) the best technology and solutions solving these challenges.
See the full webinar recording here and the top takeaways from Jeff’s journey below:
Dazzle Customers With Developers.
It’s become a cliche in the tech world for companies to define themselves as “customer centric.” However, even in today’s competitive landscape, many tech companies fall short in actually delivering on this approach.
According to Jeff, in order to keep your eye on the customer and not lose sight on organizational dynamics or nonessential projects, tech companies need to intentionally build mechanisms to refocus their efforts. Signals like Net Promoter Scores (NPS) and user surveys are nice to have, but at the end of the day, they don’t provide a holistic perspective of successful customer-centric execution.
TACTIC: Connect your customers with the people actually building and most intimately familiar with your product. For Twilio, this meant bringing developers to the front lines and having them work directly with customers.
“Business people need to think of developers as creative problem solvers (not just people who will grind out code). And when you think of developers that way, you don’t need to share solutions with them, instead you need to share problems with them. What are the biggest customer or business problems that you’re trying to solve? Make your technical teams a part of answering those problems. When you do that you get a whole new level of output, quality, and speed.”
Wear Your Customers’ Shoes.
There’s a constant balancing act between sticking to your product roadmap and sidetracking it for customer needs.
“One of our values is to wear your customers’ shoes. The important thing is where the apostrophe goes — it’s customers’ and not customer’s.”
TACTIC: What you generally should focus on is the collective customers’ shoes. Here, it’s important to abstract the needs you’re hearing from multiple customers into something that is broadly applicable to the entire market. This allows you to serve your larger customer base better as a whole.
If you wear your customer’s shoes, that can be interpreted to do whatever it takes for one customer and the risk here is that they may have too many bespoke requirements leading you to not build a product that truly meets the broader market need.
Developer-First (Not Developer-Only) Sales.
When Twilio IPOed in 2016, they only had 12 salespeople. You might be wondering how they raked in any customers with only 12 salespeople! Jeff pointed out that the company’s ability to get as far as it did was largely reliant on this developer-led culture. He also admitted they “made a mistake” here and that in retrospect he would have scaled the sales team much earlier.
TACTIC: Build a developer-first, but not developer-only sales approach. While developers are an amazing foot in the door with customers that are predominantly developers themselves (and generally turned off by salespeople), you still need a sales team after the initial customer interest to close deals and both cross-sell and up-sell over time.
Today, Twilio’s go-to-market efficiency is right about where it was in 2016 when they IPOed. In Q4 2020, Twilio only spent ~23% of their revenue on sales and marketing (for a sizable reference, many slower growing companies will spend 50 to 70% on sales and marketing). While Twilio has grown their go-to-market team tremendously over time, now with 50% growth year-over-year at a $2 billion run rate, the bottom line is that Twilio’s developers are fundamental in the sales process with the go-to-market team as an add on to scale.
Build Dozen Bagel Teams.
It’s easy to stay close to your customers and your mission in the early days when the company is small. And as you scale, you need to recreate that small-feel environment.
TACTIC(S): Create small, customer-focused teams. To do this, there are three areas you need to define:
- Customer: A team’s “customer” can be internal or external. Regardless of what you do in the company, you need to know who they are and who you’re here to serve. The more explicit you are in defining this customer and making it known to the team, the better off you are.
- Mission: What are you here to do / build to help solve your customer’s pain point?
- Metrics: What are the metrics that tell you if you’re succeeding for that customer?
Jeff elaborates that once a team defines these three areas, they’re then given almost complete autonomy. The downside? Having a bunch of small, autonomous teams and no top-down command environment creates some redundancies and a little chaos. According to Jeff, as long as teams are innovating and meeting goals, he’s not worried about the minor redundancy, especially compared to the other extreme which is bureaucracy and snail pace execution.
Build Vs. Buy is Over. Now it’s Build or Die.
IT used to be defined as a back-of-house cost center. Does the printer have paper? Does everyone’s laptop work? Then along came the rise of mobile devices and web applications. Today, most customers have a digital experience.
As digital disruptors have entered the market with new software, they’ve poked the sleeping legacy incumbents, and kickstarted that company’s own digital disruption. In short, companies can only win if they’re building to better serve customers over competition.
“It’s a Darwinian evolution going on.”
TACTIC: Buy the things that enable you to build confidently and at scale, but build everything else in-house.
This is the mantra that is fueling a next generation of developer importance and the software supply chain. Companies like the AWS’s or Twilio’s of the world aren’t selling apps. They’re selling the building blocks to accelerate the ability to build. Having these resources available makes it easier than ever to produce more technology at internet scale.
Thanks to Kira Colburn for her help on this post!