Venture Voice – interviews with entrepreneurs

Entertaining Entrepreneurship

Matt Mullenweg of Automattic

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Matt Mullengweg was a high school student looking for a better way to customize his blog when he discovered the open source software community and created the WordPress platform. A few years later, after dropping out of the University of Houston for a brief stint at CNET Networks, he founded Automattic, which he describes as a holding company for products such as, Jetpack, WooCommerce, Simplenote, Longreads and The Atavist. And just like over 40% of the web today, they all run on WordPress. Unlike many of its contemporaries, Automattic, which became a unicorn in 2014, hasn’t gone the IPO route or been acquired. In February of 2021, the company closed a new primary funding round of $288M, and it continues to grow at a rapid pace. The company recently did a $250M share buyback, primarily targeted at current and former employees, at a $7.5B valuation. 

Matt continues to be energized by the open source community, which keeps him connected to users all over the globe. In fact, even before the pandemic made remote work the norm, Automattic was at the forefront of changing the way we work. A distributed company since day one, Automattic now employs 2000 people across 90 countries. Matt has influenced many leaders with his experiences of running an entirely remote business and keeping people connected, both technically and culturally. He shares more in this episode about what they’ve learned about remote work, and what they’re still figuring out.

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Highlights from this episode:

“I call it the famous five minute install. Even though it was certainly not famous at the time, I just branded it as famous and, you know, it became a self-fulfilling prophecy. People really would talk about that five minute install as something that was a huge contrast to others.”

“It was much more just wanting the software to exist.”

“Over time, the websites came to be more and more the focus, and it was more fun to me because it was about community. There were other people on the websites.”

“Getting the job [at CNET Networks] was kind of my business model.”

“We were all just volunteers and all, I think, didn’t have a strong sense of any commercial possibilities.”

“What all of our competitors were charging for, we were doing for free.”

Our business wants were also really modest. We just wanted the people working on it to be able to work on it full time.”

“I think I ended up being the third person to join full time even though I was the founder.”

“I had so much appreciation for [CNET] for moving me out and taking a chance on a kid from Houston. I really wanted to make sure that all the things I had set out there to do I finished.”

“To me, it was just the responsibility of these other early folks who put their trust in me. They left a job that was, you know, from a real company to join me…I want to make sure that, even if everything went to zero, I could still give all these folks, like, some time to find another job and not miss a paycheck and everything like that.”

“I found that investors basically fell in two camps. There was one camp, which often had operated a company before, who were very concerned about how you were building the company…Then there was a second class that was just concerned with what you were accomplishing. So the ones that were seeing what we were accomplishing, were the ones that ended up investing.”

“I was very much not sure to take on outside investors— in fact, didn’t want to.”

“If I could choose the adult, adult supervision isn’t that bad.”

“[Tony and I] would talk and debate endlessly, including with the rest of the folks in the company, but we’d always make sure that we ended up agreeing on a path, even if it was sort of what is now called disagreeing commit.”

“We almost don’t look at the resumé at all. All we look for in the resumé is typos…I’m looking for the quality of your application, the quality of writing in your cover letter—are you a clear writer. And if that’s true, let’s chat, and then if the chat’s good, let’s do some little project together.”

“If the playbook’s working, keep doing it. But for us, the playbook wasn’t working.”

“Still to this day we have a much much lower attrition rate than almost every other technology company I’m aware of the numbers for, and so that allows you to build a stronger culture.”

“To me, bigger companies were less innovative, less fun, less good. But then once I became CEO—it was in some ways just the title change more than the responsibility—it became clear to me how right Tony was. We were capital constrained.”

“[When we closed our Series C round in 2014], that was very much a turning point for the company, because it hadn’t been as clear to me that we were capital constrained, and the opportunity was much bigger than our revenue growth was able to support at that time.”

“We gave ourselves a lot of room to really put the gas pedal on and accelerate growth, do acquisitions, accelerate hiring.”

“I think, still, in Automattic, the best work is done by small teams to this day, but we’re doing work on more things.”

“We’re 2000 people now, in our current roadmap. There’s enough work for 10,000 people easily. ”

“Our whole structure and how we try to run things is balancing out, how can we create, like, a sort of forest of small teams that are fast and iterating quickly and have a lot of autonomy, but then just do more.”

“Sometimes funds might need an exit, but you can have new investors exit them without selling the whole company.”

“[LVMH Chairman Bernard Arnault] understands the impact of technology on his businesses, understands quality, understands creativity, understands building businesses and conglomerates over decades. So he’s an amazing fit for us doing what we’re trying to do.”

“I think we’re all pretty happy with the trajectory of where we are on the private track. The advantages of being public are advantages we largely already have.”

“It’s actually very, very key and Automattic, when people become leads of a team or division or something like that, if ever they feel they’re not getting energy from it or passionate about it or the best person in the world for it, they can step down, yet still stay at the company and still have a great job or find something that they are really passionate about within the company. So it doesn’t mean they have to leave.”

“If you’re on a rocket ship, don’t jump off.”

“I always say to every shareholder, whether they’re new or existing, if for whatever reason, you need liquidity, I’ll find it for you.”

“If you’re staying relevant, you are also changing, both yourself and the product you work on.”

“I get a lot of energy from the WordPress community.”

“Google for boondocking apps and websites. There’s like five or 10 of them, and I would just use them all to kind of like log on and see what was around and see what was there.”

“I find with great internet, I can be really productive and run a company of almost 2000 people…when I’m looking at Airbnbs, I’m looking at the reviews to see if anyone mentions the Wi Fi.”

“What can we do to give people the space to navigate this, you know, hopefully, once in a lifetime stress?”

“The open source is our hack for allowing lower coordination costs among very disparate businesses and getting kind of the best of both worlds where we have best — being under the same roof — but not as much of the overhead a large company.”

“Sometimes we find more learnings from the non-tech examples…they have a much tighter margin of error for what works or what doesn’t.”

“We have some of the best competitors in the world…so we really have to be at the top of our game to stay relevant.”

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