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Published 06 June 2013 12:03, Updated 07 June 2013 07:51
Scott Farquhar and Mike Cannon-Brookes of Atlassian are revving up their growth engine with a new hiring spree.
Australian technology company Atlassian is on a hiring spree, aiming to recruit 100 people worldwide in the next quarter and 100 in Australia over the next year.
The privately held company, which is headquartered in Sydney and makes software for software developers, is gearing up to build new products and push its cloud computing strategy.
The founders of Atlassian, Mike Cannon-Brookes and Scott Farquhar, made the BRW Rich 200 this year with $250 million apiece.
“We’re hiring 100 people next quarter globally, so that’s a little more than one a day and at least 100 in Australia over the next year – so we have huge growth plans,” Farquhar told BRW. “The plan is to be an Australian success story … and keep inspiring the start-up eco-system in Australia.”
Farquhar says most of the new jobs are in engineering, and the company also plans to hire a lot more designers to improve the user experience.
The new jobs in Australia alone represent an investment of $20 million over the next year, with salary cost representing about 60 per cent of the overall figure according to Atlassian’s head of talent, Joris Luijke.
Any future listing, if it were on the cards, would not be on the ASX. We’d be almost the only software company … you wouldn’t get the valuation, they wouldn’t understand our story the way the US would.
Farquhar says Atlassian has done about 10 acquisitions in its history and will keep looking for opportunities.
But he declined to discuss plans to float the company.
“An IPO, we just can’t comment,” Farquhar says. “Any future listing, if it were on the cards, would not be on the Australian Securities Exchange. We’d be [almost] the only software company … you wouldn’t get the valuation, they wouldn’t understand our story the way the US would.”
Atlassian took in $US60 million in venture capital funding from Accel Partners in 2010, and it was widely reported at the time that the long-term plan was a listing on a US exchange such as Nasdaq.
Farquhar says most of Atlassian’s investments are things that will pay off in the long term, with the plan being that the company will still be around in 50 years’ time. A major plank in the development strategy for the coming year is to build a “personalisation engine” that tailors the company’s communication to the individual customer – rather than relying on sales people making a best guess based on industry, company size and job role.
“We want to build an automated machine that does that, so that whenever you visit an Atlassian website or property or you get an email from us, all the information is tailored to you based on all the information we know about you. So one of the investments is, I guess, a personalisation engine for our customers,” Farquhar says.
“At the moment, somewhere north of 10 million people use our software on a daily basis but we don’t yet have a great relationship with each of them, and we need to build that out over time.”
The other big investment for the coming year is to improve Atlassian’s cloud offering, which is a small part of its business but the fastest-growing segment. Farquhar points out that Atlassian’s traditional software has 10 years of development while its cloud offering has five years.
“We have a few disparate services that we’ve either acquired or built, and we want to make sure that people can seamlessly access those services … so it’s a single integrated experience,” Farquhar says.
“It’s something similar to what Google went through – Google went through a two-year period where they integrated all their Google services under their enterprise accounts, and it takes a while to make sure it’s all easy for customers. You can do it all today but there are just a few more hoops to jump through to get it all set up.”
Farquhar says there is huge growth opportunity for Atlassian because these days every company needs to develop its own software as a differentiator. The sweet spot for Atlassian products is teams of 20 people and up – Farquhar quips that for teams with fewer than 10 people, “the most efficient collaboration tool is a whiteboard”.
“We can sell our collaboration software to a car manufacturer or an investment bank or Nike when they put fitness apps in their shoes,” he says. “Instead of companies buying billboards on Main Street, these days it’s making websites or social media engagement or marketing – so more and more of every company is becoming software, and we’re growing through that.”
Atlassian has about 700 employees, with some 60 per cent of those in Sydney, plus significant offices in San Francisco and Amsterdam, a handful of developers in Poland, and small sales offices in other markets.
Cannon-Brookes says company is hiring on five continents (North and South America, Europe, Asia and Australia) and the rapid growth will inevitably bring growing pains.
“Scaling a 50-person company into a 100-person company is one thing. But scaling a 500-person company into a 1000-person company is totally different,” Cannon-Brookes says.
“All the standard growing pains – reorganising and restructuring the company – is always painful. Growth companies are great because they’re growing but they also create a lot of churn and change. People’s jobs get a lot bigger very rapidly and they have to learn and keep up with that. Scaling our people is a hard part that we spend a lot of time on – from the point of view that if you’re managing 30 people now you might be managing 100 people in three years’ time, so if you’ve never managed more than 30 we need to get you some help.”
Cannon-Brookes says Atlassian invests in training and also tries to structure it so that people have mentors. For example, for five teams of 10 people the company might hire two experienced managers and promote three less-experienced people who show potential. Then get all five to collaborate and consult one another.
“You talk to that person because he knows what he’s doing and you can learn,” Cannon-Brookes says. “We do that a lot in various aspects of the business, bringing in people from the technology industry in the US, people from Europe, and they come to do a job but they also come just as much to transfer those skills to people we think are just as smart and talented but just don’t have that experience yet.”
Cannon-Brookes, who has previously criticised Prime Minister Julia Gillard for her crackdown on 457 visas for skilled employees, says Atlassian makes use of the program because the Australian technology environment has more jobs than people to do them.
“The fact that we have more 457 visas than university graduates – or whatever the basic problem was – is that we have more jobs than university graduates. And also that not every job can be done by a 21-year-old with three years’ uni experience,” Cannon-Brookes says.
“I need a 40-year-old who’s used to managing 50 people, I can’t take a computer science graduate and put him in that role. We have to bring in people from overseas, it’s the best thing for the economy. We bring in people between 20 and 40 who are highly paid, well educated, have kids – and generally when they’ve been in Australia for three or four years, love Australia and decide to stay and pay taxes for 50 years. This is an awesome thing for the country! This is phenomenal! It boggles my mind that she [Julia Gillard] would say that it’s a bad idea.”
Cannon-Brookes says Atlassian is already hiring a lot of Australian computer science graduates and IT professionals, but this is not enough – especially as the company grows. While Atlassian might be able to do without 457 visas, Cannon-Brookes argues it would be a smaller company with less impact on the world – and ultimately end up paying less taxes to the Australian government.
Farquhar, who is equally passionate about the issue, adds that 457 visas help counteract the brain drain.
“We’ve lost so much talent overseas with people going to Silicon Valley or for other reasons, we had a brain drain so we need to attract some people back to Sydney,” Farquhar says.
“The way we use the 457 visa is for roles that don’t exist in Australia – there are no product managers with 10 years’ experience in Australia, so we need to import those people. And once we import those people they can then train the next generation of Australians with those skills. It’s a critical part of remaining an Australian company – otherwise we’d have to move wholeheartedly offshore because we just can’t find the talent and train the people locally.”