DAVID LEDGERWOOD: Steve, it's good to have you. Thanks for joining us.
STEVE BEYATTE: Thank you, Ledge. It's good to be here.
LEDGE: Can you give a two- or three-minute background on your story and your work? It sounds like you're doing a lot of interesting things.
STEVE: Totally! My name is Steve Beyatte. I've been working with startups on the engineering side for about ten years now. I actually started my career as a digital nomad but this was ten years ago before there was sort of a pretentious world and lifestyle around that sort of thing.
I was living in places like Bali and Morocco and Spain building MVPs and dev applications for U.S. companies. And then, in the past six years or so, I've transitioned to doing more engineering leadership sort of stuff based in San Francisco.
In that time, I've been lucky enough to have both of my main startups go through successful exits and the first of which was called “Swarm Mobile,” a company I co-founded in 2012. Swarm was a hardware-software product that was sort of like Google Analytics but for physical locations.
After raising money and building up that engineering team, we sold it to Groupon in 2014. And after a few years at Groupon, I took my next role as VP of engineering at FareHarbor.
FareHarbor builds sort of a kickass software for tourism and activity companies all across the world. And in April of 2018, we were acquired by booking.com.
As of now, I've actually transitioned out of my role as VP of engineering at FareHarbor and I'm currently pivoting into more of an investor role. I also act as an advisor and consultant where my focus has been in helping early-stage companies hire great engineering talent and continue to build robust engineering teams and navigate sort of the ultra hot engineering labor market that we have especially in San Francisco but all over the United States and probably the world at this point.
LEDGE: Let's talk about the key points of hiring and building a great engineering team. Actually, we're in the business of evaluating and vetting engineers all the time and we spend a lot of time doing that.
I'm just curious. When you're out there advising companies on “Hey, we've got to hire; we've got to build,” what are the key metrics and heuristics that you use?
STEVE: As far as the key process points, the first one is making sure that you're thinking about engineers as actual people who can potentially join your company. If you're an engineer and you live in San Francisco or anywhere in the United States, I can imagine that your LinkedIn inbox is full of kind of spammy recruiter messages like “Hey, we've got this great opportunity for a language that you don't know and have no reference to on your LinkedIn page. Come talk to me about this thing.”
That just doesn't work. People want to be recruited as people. Think about sports. If you're a college football player and you're going to get recruited by the 49ers or whatever it is, you're not getting some stupid message from them that doesn't reference anything you've done. You're getting them super personalized.
Obviously, the economics are a bit different in that sense. These engineers have the opportunity to work wherever they want which is one of the major sticking points on why people switch into that career in the first place. And you kind of have to work within their framework to get people to pay attention to what it is you're trying to do.
LEDGE: I love the comparison because we often say that. We're kind of like high-end sports agents. Luckily, we control a lot of the really great players in the draft. And they trust us to represent them as people and to represent their interests and not do that weird “bait and switch” or just awful sort of recruiting thing that you're talking about with their LinkedIn.
And that comes down to really developing that relationship. I totally resonate there. I imagine that you probably have to evaluate sort of company and engineering values to make sure that there's a fit there and help them understand the types of hires they should look for.
What is that like?
STEVE: There are two sides to that market, obviously. Coming from the company side of things, one of the things I talk about a lot is how to craft your pitch as a company. And the first thing I tell people is “Don't craft a pitch. Just tell the truth and make your company awesome so telling the truth is easier.”
You can say, “Hey, we're an engineering-centric organization that really values the quality of code and the insights that you're bringing to the team over just JIRA tickets. But if that's not true, when someone starts at Day One, they're going to be upset and you've already kind of burned that bridge of creating a cohesive team. From the engineering side, what do you actually want to be working on?
We're in a pretty unique day and age where most engineers, I would say, especially if a year or two of experience can work at pretty much any company they want and work on a huge variety of problems.
So thinking about what would actually be meaningful is a big conversation I have with everyone whom I've managed in the past six years.
“What do you actually want to work on? What would be cool? Do you want to build big systems? Do you want to build interfaces?”
Focus on something that actually feels meaningful to you so your day to day doesn't feel like a slog.
LEDGE: We deal with a lot of people who maybe have moved out of the SanFran or New York area and even some of them who are not digital nomads but they happen to live in a cabin in Montana or come from the Midwest. They're great engineers and are always interested in working for the same types of companies that are out there and will often come for half the loaded cost.
What's the ecosystem like to get into that? We know the answer at Gun but it would be cool to hear from kind of an insider. How do you get into those positions where you can be a trusted remote engineer for those valley-style companies?
STEVE: I think the first question that I would ask is sort of ─ I'm sure you, guys, look at this all the time ─ is how are freelancers viewed? How are remote workers viewed from within the companies that you're hiring for?
Obviously, they have some sort of appetite for it that they're talking to you, guys, and making hires. But, at the same time, I would look more at “Are you the one freelancer on the team? Is everybody remote? Is everybody having in-person communication and you're the one person who is kind of ‘out of the loop’?”
I would look at all of those things in crafting a response there. I mean, really, I think it's the same blanket answer I can give if you're in person and it's to make yourself indispensable. Create value. Make sure that you're thinking about the people who are above you and below you and newer than you or older than you and making sure that all your interactions are positive and you're really trying to not think about “Oh, I got hired to build this API for this company.”
You got hired to solve a problem that somebody higher up the chain thought is going to be solved with that API and really taking into account that you're not there to write away code; you're there to solve that problem. And if you can solve problems for companies, you're going to be in demand no matter what.
LEDGE: You talked about anybody in a one to two years experience who can really sort of write their ticket now in engineering. Maybe that keeps going forever; maybe it doesn't. But, right now, it's a seller’s market.
How does, in that case, someone who actually has the ten plus years of experience and all the value that comes with that ─ how do you recommend the senior people differentiate from the people who kind of check the box and really sort of are engineers but are not ten-year or fifteen- or twenty-year engineers? Do you see any differences there?
STEVE: The obvious difference is just in that general value proposition, I would say. I mean, if you're someone who’s maybe coming out a coding bootcamp or something like that and you're super excited about the field and want to get your hands wet build bigger and bigger things, you're going to be a really good fit at a startup that maybe doesn't have a ton of money sitting around, a big cash pile, and they want to invest in people who are hungry and who want to make a name for themselves in their careers.
The value probably changes when you have ten or fifteen years of experience. A lot of these people have families or they really value stability more than they do the opportunity to work on that next big thing and take risks.
Balancing out that appetite for risk versus balancing out what sorts of things people want to be building changes for every twenty-year senior person who wants to just to work at startups. There's always that one- or two-year engineer who would want to work at Facebook or whatever it is depending on the person.
I'm sure you've seen all the time balancing out what a company wants with what talent is. That's the most important piece.
LEDGE: Just like the company needs to know itself and what it's looking for and what it can afford, I think there's this vector where the person who wants to be that freelancer needs to know himself or herself and really understand the things that they value because maybe there's a currency in stability or a currency in benefits or a currency in cash and equity and what have you.
So you really need to think about “What things do I value as an individual in my current chapter of life?” because you may not fit. You might really desperately want to work for a high growth start up for equity only but you also have choices where you have children and you've got a house.
LEDGE: You have to think where all that fits together.
STEVE: I think a big component, too, as you move kind of more into senior engineering is how much oversight needs to be given to you. Can I give you a project and kind of give you the broad strokes for it and have you fill in all the gaps in there or are you going to need a little more supervision to get to the end of the goal?
That's one thing that happens a lot as someone transitions from a two-year role into a senior role.
LEDGE: Absolutely! You've gone from digital nomad to leadership to now thinking about investing in companies. How have your views evolved and changed over the course of that time?
STEVE: I would say that seeing it from all angles has been the important part. When I was a digital nomad, I was working for companies and really trying to keep in mind that I'm not writing code because they want someone to write code. I'm writing code because I want to solve a problem.
They want to make money. They want to build a product. They want to do whatever sort of initiative that's handed off to person that I'm there facing with.
Focusing on that is so much more important than focusing on what language it's going to be written in or what the architecture is going to be like or anything like that. All these things are important but, at the end of the day, if I work on something for six months and that box isn't ticked on why they hired the engineer, then, I'm not getting that contract renewed or whoever is not getting that contract renewed.
From the leadership side, looking down at sort of a team of people, what is important to them? And what's important to them is “I want a job that's meaningful. I don't want to go to work everyday and hate my life and come home and feel like my boss sucks.”
You want to have fun. You want to feel engaged. You want to feel like you're part of a community, whatever that is. And if you have a remote team, there are components that are different than if you have a team of folks who are in person.
From an investor’s standpoint, I'm beginning to learn sort of what's important there, too. What are the factors? What are the vectors worth paying attention to?
It's a learning game but I appreciate the opportunity to learn from all the different angles.
LEDGE: Here's an optics to investing and you and I talked a little bit off-mike about this. Having full-time employees who have been hired with those investor dollars and filling those desks up and looking like a company is actually something that people take very seriously when you maybe could staff the same or better talent remote and distributed using those dollars.
And so, from a return-on-equity standpoint, it would actually make more financial sense to go and hire people who are not saddled with $4000-dollar-a-month rents in San Francisco.
We know that doesn't happen and there's a great hunger to have those butts in seats. You're about to invest your own money. I'm curious. How are you thinking about that? Do you want your money spent in one way or another?
STEVE: There are a couple of different questions in there. I would say, first, from an investor’s standpoint, the important part is the team, the idea where people are going. How you get there is ─ as long as you have a tracker for that success and you've thought through all the things and you're being thoughtful and intelligent about the market that you're entering, I think that's a huge piece of it. And there's so much timing and luck involved in that part.
But to get back to another question that you're asking, people still make a link between butts in seats, physical work locations, and accountability. I think there is a little bit of truth to that but I think it will shift over time.
But if you bring non-technical people in ─ maybe it's a CEO ─ who aren’t necessarily writing code, they're going to think that everything is going to be more effective ─ I think there's a habit, I should say, of thinking that things are going to be more effective when people are working together in person.
At least in my experience, I think there's some truth to that. There can be. I've worked in remote teams that are absolutely amazing where everyone is completely in sync and working really well together. But I've also worked for remote teams that aren’t.
For in-person teams, there are tons of opportunities where people sit around and do nothing and not really get stuff done; and there are tons of opportunities where everyone really works really well together.
It doesn't come down to remote or in person. It comes down to all those softer skills and how we communicate. What are the milestones? How are we communicating these things across the team?
That's the part that holds everybody together, not the factor of in person versus not. That's, at least, from where I stand.
LEDGE: That absolutely comes up every time I talk about remote. This is just good leadership and management and self-management and autonomy. These are all things that you need to do regardless of the work scenario. It's just that it becomes highlighted in a remote and distributed environment if you're not doing those things.
STEVE: And I think that gets amplified when you get people who have less experience building technical products. Maybe it's a less technical person, maybe it's someone who has never built anything before.
They've always been where they've been to build their things. Still, they want to see someone next to them. They want to be able to ask questions. They want to be able to have a conversation with them all day long. That's the part where it gets, I think, harder to manage.
LEDGE: Last question: You've had a couple of exit scenarios. Congratulations! That's amazing. That doesn't happen to everybody. I'm curious how you managed the transition of engineering teams from one org to another. That can be a real cultural shakeup and it can kind of scare the people on the ground a little bit.
“Hey, I have a new master here.”
How did you smooth that out so that it was like “Hey, everything is going to be okay and we're going to keep doing our work and we're just part of a different entity?”?
STEVE: That's a great question and I think it's different with every acquisition ─ and it certainly has been for me. I think the bigger question there is “How do you do that when even I don't know what's going to happen?”
The best way that I've approached is just trying to be honest with people and say, “Hey, this happened. It's a great thing for everybody. This is what it can look like. This is how this can fit into the things that you want to do in your career.”
I think no matter what, usually, when it's a smaller company being acquired by a bigger company, there's a ton more opportunities for engineers and not a lot of things are going to change.
Yes, the value prop is different but you're probably not going to like 10x your equity like the larger acquiring company, at least, not from my experience. But, at the same time, as people grow in their careers, usually, they want more stability; usually, they don't want to think, oh, is my paycheck going to come in a year or whatever it is.
Working for a big company is a great thing on a résumé. But I think just to get back to your question a bit, it's just being honest with people and not pretending like you have a bunch of answers especially when you don't and just being open about communication and transparent about what's happening.
LEDGE: I think that's always the best answer. Steve, thanks so much for joining us. I really appreciate the insights.
STEVE: Thank you for having me.