GoodData founder Roman Stanek talks about his business
During our interview tour in Silicon Valley, we talked with entrepreneur Roman Stanek about the business model of GoodData. Furthermore, Roman shares his learnings and advice for young entrepreneurs.
The transcript of the interview is included below.
Martin: Hi, today we are in San Francisco and doing good with GoodData. Roman, who are you and what do you do?
Roman: I’m Roman Stanek, I’m the founder and CEO of GoodData and we help companies to collect, store, organize, analyze, visualize and distribute data.
Martin: What did you do before you started this company?
Roman: I started number of companies, multiple companies, all in hi-tech space. When Java was two months old I started company called Net Beans and it’s now part of Oracle. Then I moved on and started company called Systinet that’s now part of HP and it’s one of the first cloud-based companies. AWS started, it was my first customer was AWS a long time ago.
Martin: So you are totally into clouds?
Roman: Totally the cloud follow ups, exactly, 11-12 years.
Martin: Great. And how did you come up with the idea of GoodData?
Roman: The GoodData idea is actually my initial idea 20-years ago when I started my career. I actually spent time in the database business, I worked for Sybase and seven years ago, when I started, I looked at what the next opportunity would be. I kind of came up with this idea of kind of data in the cloud and as a next big thing. And it was so early, the term big data was not coined then, and even the fact I was able to buy gooddata.com, data was not in fashion in 2007 when I actually started the company.
BUSINESS MODEL OF GOODDATA
Martin: And can you briefly describe how the business model works at GoodData?
Roman: The business model is a SaaS model, so we don’t… It’s a subscription based model. As I said, we help companies to manage their data and GoodData is an end-to-end platform. So, we do every single step from getting the data to getting the finished visualization and so forth and so on, and we charge monthly fee for it and that’s kind of the most predictable and the most efficient way how companies can buy analytics these days.
Martin: Ok. And are you focusing on a specific kind of function in a company, like marketing, sales, funds, whatever, or is it that you are a general platform for everything related to data?
Roman: It is actually, on one hand Gooddata is generic platform, so it can be used by IT and different parts of organization. But if you look at what’s happening at modern enterprise, only 5-7 years ago most of the data was created inside of the firewall, in some ERP function in some SAP and so on, and that’s where most analytics used to be. Now, the analytics is all focused on external, the touch points with customers, how do we interact with our customers and prospects and partners on the web, on social and mobile and so on. So, most of the data is actually created outside of the firewall and that’s why we analyze it in the cloud, and the next step would be, kind of the internet of things when 99% of data will be created outside of the firewall. Now we analyze the interactions of our customers’ data, in couple years we will be analyzing interactions with devices of our customers. And that’s kind of the next evolution of big data.
Martin: How did you acquire the first customers when you started out?
Roman: How did we acquire customers… It’s interesting… If you look at being entrepreneur, your first customer is almost like your VC. They almost get no benefit out of it, not even equity, and so the first customer needs to be somebody who really trusts you, who actually is so visionary that he wants to do better than just follow company. They want to help the whole industry, because it’s a lot of reward, working with a product that’s half build, half backed, not ready, it’s actually a lot of work and even if you get it for free, it’s still difficult.
Martin: How do you convince those guys?
Roman: Again, it’s they need to be visionary, you don’t need to convince them, they almost need to convince you. The first customer needs to be who says “I’m looking for is to increase the competitiveness of my company. I’m really into it”. It really needs to be almost like a co-founder.
Martin: Okay, great!
Martin: Let’s talk about corporate strategies. What do you think is the distinction between you and your competitors?
Roman: What really makes us set apart is, first of all, we really have this vision for solving the problem completely. Most companies, if you ask them “What do you do?”, they say “We do: how we do visualization or we do data cleansing”, or some of the aspects of data measurement, and we essentially do the whole end-to-end from data to insights.
Martin: Ok, great. If you’re looking at your product strategy for the next 3-5 years, what are the areas you would like to dig into?
Roman: The next 3-5 years it’s going to be a lot about the volume of data, internet of things, unstructured data, more and more data is now being introduced by the way we interact, the visual and social and so on. It’s also going to be about being able to find insights automatically, machine learning and so on. And the last one is ability to benchmark data automatically. If I tell you that you can close a deal in 20 days, it’s valuable, but if I tell you that your competitors close deals in 10 days, you know that you’re not doing well. So, being able to kind of put data in perspective is going to be more and more important.
Martin: When you look at the marketplace, there are several big data startups who are just trying to solve one problem and one industry, like, for example, for the finance industry and banking etc., there are several startups. And you’re trying to solve this kind of big data problem for lot of functions, for lot of industries. What is the reason behind doing that? Would it be more adventurous for focusing only on one industry and solving their problems much better?
Roman: I see that this is kind of, as I said, on one hand we are generic platform, but we really focus on sales and marketing executive. That’s where the most of the customer interaction actually is. And at the same time, kind of the cloud based platform that is open and has APIs and so on. We actually let our customers to decide and take us where they want to take us.
Martin: Ok, great.
Martin: If you look at the market in general, what is the perspective on the major trends happening right now in the cloud industry?
Roman: The cloud industry, first of all, big players are really investing heavily. This city was full of Oracle in the last couple days and Oracle is saying well yes, it’s not only Google and AWS, it’s also Oracle, Microsoft is big in the cloud and so on. It’s really kind of industry that is maturing very fast and it’s being kind of endorsed by major players. In five years, we will not see the traditional IT organization as we see today. It’s going to all move to the cloud and the CIO will not stand for informational infrastructure, it will actually be innovation.
Martin: OK. And do you also see some kind of external certification companies, let’s say certifying security, or data related kind of concerns?
Roman: Oh, it’s already happening, obviously, the security and privacy. We actually, big part of it we are kicking off of data privacy initiative. But there are many organizations that do it.
Martin: OK, great.
ADVICE TO ENTREPRENEURS FROM ROMAN STANEK
Martin: You started several companies, Roman. What advice would you give your son if he would ask you “Should I start a company and how should I do it?”
Roman: I would say, at the end of the day, being entrepreneur it’s, you have to really work hard, it’s all about being “all-in” in what you do and being extremely paranoid every time you have a good idea, you have to always assume that there will be 10 people who actually do the same. At the same time, you have to assume a lot of risk. Because you do something that nobody has done before you. So, it’s kind of that combination of being able to be “all-in” into an area or initiative that nobody believes in, that’s kind of combination that’s difficult for many people. Some people like to work hard, but they would not take the risk. Some people to take the risk but they are not willing to work hard. And you have to do both.
Martin: What advice can you give somebody who says “I want to start a company but I don’t have an idea”?
Roman: Go and get a job and see where there are problems. That’s how many large companies started, by somebody saying “I worked for this large company, I was kind of disappointed by this missing piece of the process so I clearly saw there is something missing and I went and automated it”. I think that’s the safest way how to start a company, it’s to actually spot a problem in somebody’s payroll.
Martin: And what other advice could you give your son?
Roman: For my son…, for my son it’s all about spend a little time in school, learning not only how to play at computers, but how to read and how to develop some critical thinking, how to be creative and so on. Because this century is going to be all about creativity and critical thinking, it’s going to be century when flexible and adventurous and creative people will actually win.
Martin: Roman, thank you very much for your time.
Roman: Excellent, thank you.
Martin: And for you thinking about starting a company, next time you try to assess an idea, be critical about it. Thank you very much.