 Good morning Martin and good morning everybody. We'll be talking about taking European companies global and we're going to do it with a twist. Whereas normally people talk about taking the commercial organization global. This time around we're going to speak to Martin who's the CTO at Salonis about taking an engineering and product organization global. But let's start from the beginning. So Martin can you explain a little bit what Salonis does just to set the context? Yeah sure good morning also from my side. So we at Salonis we're developing technology like largely data processing technology which we're delivering as a software as a service solution to customers and I mean the important question is like what do you actually do with that technology? So what we enable customers to do is to put like a process management process mining process observability and automation layer on top of their business processes. That's a little bit abstract so you take an ERP system inside of the ERP system you're running your purchasing you're running your order management and so on and so forth. You put Salonis on top and then you can exercise much better control over what's actually happening inside of your business. Yeah sometimes I explain it as it's like waving an x-ray over a company and then seeing what kind of processes the company follows and then giving recommendations and actually actions to automate some of those processes. So Martin Salonis was started in Munich. How did you build the product organization and the engineering organization in the early days? Yeah so it was mentioned like also at the beginning so we ran the company in a bootstrap fashion for the first five years and this is also how we built the organization so we grew the organization very organically we brought in people we grew talent internally very tight knit organization but then as the company grew we had to bring certain levels of structure to the organization like just to make sure that we are able to manage so I think this is kind of similar to what most companies at that stage what experience is what we did is like taking the key leaders from the organization turning them into managers broadening the organization and being bootstrapped like using opportunistically ways to just get people interested in Salonis because I mean as most of you probably know it's very hard to hire good engineers so we had a lot of homegrown talent who were building the product and the platform in these days. It's already problematic in a way right because you take your best engineers you're going to say don't build product anymore now become a manager and then sometimes it turns out that these great engineers aren't actually the best managers so how did you deal with that? So that was a big challenge because the people who knew the software the best who knew the code the best were also the people who kind of had the natural leadership skills but I think what we saw is that and we learned that also along the way is that like leadership and management is not the same thing and we have to be careful that we're putting people into the position where they can exercise leadership the best way and for technical leaders that might be an individual contributor role where it's also a lot more fun for them so like I'm personally I'm an engineer and what I always say is like I love solving technical problems I don't love so much solving people problems or working on these on these management topics so I think it's like back in back in the days it was the natural thing to do also because we we didn't have a brand yet we we had like also in Munich like fierce competition in the market so there were not a lot of other options what we could actually do but it has been like one thing as the organization scaled up we consciously did was seeing that like we create IC tracks we make IC successful we allow people to step from management roles back into IC roles to make sure that our most valuable engineers can actually work on engineering and in driving the product forward yeah so it's not unusual in the sense that many organizations have a management track an individual contributor track and you can get rewarded on both tracks you don't necessarily have to become a manager in order to get paid more or to have more influence in the organization I think a twist of that is like as an as an engineer sometimes we're like okay we can build everything and we can self organize and so on and so forth but like the the flip side of that is that as the organization grows and and is becoming bigger and then also becoming distributed is that you need good management as well so you don't just need good engineers but you also need good management because you have to establish processes you have to establish an accountability structure you have to make sure that people work on the most important stuff for the company and not just the things which they are like most excited about so I think both is like very important I think from from what I have learned is that like management is something which is easier to import into the company engineering culture and engineering skills and context of the technology and so on and so forth something which is much harder to bring in externally into the into the into the company correct um just to set a bit of context so Salona's now has 3000 employees yeah 650 and product and engineering so it's a sizable organization yeah when you start to grow your organization in Munich you mentioned earlier in the day that you actually were competing for engineers with with a number of incumbents right yeah how did it go um so like in Munich over the last years like a lot of like large also u.s. companies established a presence and especially for for engineers like there was a pretty fierce competition so there's google there is amazon there is microsoft and like these companies also at least to some extent imported silicon valley salary bands to munich which is quite difficult for a for a bootstrap company to match and so yeah we just had to be creative that we were like forced to like foster and homegrow our talent but we like at the same time we had to build a brand and trust in the community um for for being able to attract um like high-profile engineers and people with more experience because i think one thing one thing which i've learned um over the years is like when you want to attract um senior engineers uh who are interested in building like an individual contributor career with like very special skills uh in a certain domain which you uh which you need then um you have to take the position of them so so why would they want to join your company and especially for these engineering careers i think big companies uh big tech companies um provide a very let's say relatively low risk path uh of building such a career and uh they have people in technical roles uh who people want to work with and for us being uh being a company with like homegrown talent like no kind of um uh let's say uh prominent profiles uh per se in the company um that was one factor which was pretty hard for us to overcome uh to actually attract people because they they want to work with people who have a track record um it's similar i guess for for you on the investor side for you like working with serial entrepreneurs is also uh sometimes simpler than putting a bet on a company like Salonis with like these three guys who um don't have a clue about what they're doing yeah well it turned out that you did have a clue but yeah well in hindsight right so so Salonis services and like it has as customers like 20 of the global 2000 yeah about half a billion in in revenue so the company ended up going global commercially but why did you decide to also take the engineering organization global because you didn't necessarily have to right you could have tried to kind of just keep it all in one place in germany yeah i mean i think the great thing about software uh is that um like you don't have to ship any physical goods you don't have to like go local for production or something so per se i think uh taking a source global uh from a technical standpoint basically means like you might want to deploy to some other data centers or uh um uh yeah getting closer there but for us so we're working uh with like very large corporations we're working with uh regulated industries as well um and so the initial um push why we went to the us was because some of these companies they have like guidelines or or policies that part of the system has to be operated by us people on us soil um so that was basically driven by the business um that we have to build some kind of platform engineering presence because one of the things we're doing is we're operating a pretty large scale distributed data infrastructure um for our customers um so so that was the that was the one side so i think in general like if you decide to introduce a certain additional level of complexity into your organization and internationalization is definitely it's a big um it's a big step in terms of adding complexity because of the time zone difference because of the cultural differences and so on and so forth you have to do that like very purposefully so you have to know why you're doing it and uh for us uh supporting the business was was one key reason the second one is that like when we started um uh Salon is uh like cloud and uh uh cloud infrastructure wasn't really a thing which these customers uh or our customer groups would uh accept as a as an operating model so so initially Salon is was a was like an on-prem product which you went out and deployed to your customer and we did uh very big transformation where we um uh yeah essentially redeveloped a large part of the stack um uh built a cloud native platform um but that also introduces a lot of additional duties because like now it's you operating the service it's you not like just shipping an install or a software package um to customers and they run it but like it's software as a service um so 24 hours 24 hours yeah it's a lot of additional processes in terms of what you have to do um in terms of certifications and and so on and so forth so um the the fact that we had to internationalize our business because the US is the biggest software market in the world um combined with us like offering a software as a service solution combined with the additional certifications um in the end um like plus um the access to a bigger talent pool um where I think the main reasons for us for thinking about going internationally or almost forcing us to go international so if you have a a whole team of people on the west coast in the US yeah you have a team in Madrid if I'm not mistaken yes and a team in Kosovo yes amongst others yeah and one in Prague one in Prague as well of course yes so tell me how things changed when suddenly you were recruiting engineers in Silicon Valley and managers in Silicon Valley um there must have been a certain kind of culture clash between the new people coming on board from the outside yeah and the existing people who have who had grown with Salonas over a number of years how did you manage to integrate those two different kind of groups of people yeah that that's a that was probably the most difficult challenge which we had when when when scaling was that it's it's like onboarding people to code and so on and so forth like this is all doable but making sure that we're like also able to establish the culture or to export the culture which I think makes our company unique um is has been has been quite challenging especially as we did this like during also during the corona phase where it was just very hard to travel and and so on um so um yeah there was like a lot of so when we hire people in Silicon Valley for example there's like relatively high salaries compared to the current workforce there is like a question of how do you distribute projects how do you um how do you kind of do you take new projects do you cut projects in half or products in half how do you distribute the um the the responsibilities um and what we I think did relatively well is start with uh kind of uh like bring in a few key people experienced people people who you can build trust with and people who have a network um in these like in these regions for example in Silicon Valley um and then first like get them on board um build a relationship with them and then scale it up and we also did things like a an exchange program for example where uh some of our like very first engineers uh were traveling over to the US for for some time like meeting with the people and just giving context um about the uh about the uh the the platform and the way how we are thinking about engineering and that's also one thing which I personally I think I underestimated the importance of that at the beginning is um we're we're like a very a very tight knit team so like basically everybody was friends with each other and uh we have been working together in a very informal way for a very long time um so basically uh if you would tell someone in the team some something okay like you have to uh we have to we have to make this part of the software faster we have to make this part of the software we have to do it differently then then almost everybody would end up with the same conclusions on how to do that now you bring in someone uh who has like a very strong background in in engineering you bring them into your company you tell them the exact same question most certainly they will end up with very different conclusions on how to do things on on where to where to do things on how much that would cost on how much time that would take um so um that I think was the was the biggest challenge uh there was to establish the accountability to establish the trust which I think is the basis for almost all work uh like not just within the company but also um between the employees uh and then to bring the context so that we can create alignment um within the organization and have everybody run to the same direction um without like just like micromanaging uh every task because then you don't need experienced people I think in the process your own role ended up changing as well right so you ended up hiring a chief engineering officer yes tell us a bit how that went yeah so so I mentioned that earlier like when we when we started um like basically putting people who were individual contributors and kind of our best engineers into management roles um and I wouldn't say that I'm the best engineer in the company but I I also went through this process of okay like at the beginning it was the three of us then we added some more people but I was still like doing a lot of work on the actual technology but eventually our organization grew to others to a size where I couldn't spend time anymore on thinking about the technology but I had to spend a lot of time thinking about how do we structure how do we hire um like basically what I would say from a from a product standpoint or from a from a technology standpoint our non-core topics um and um so that came to the point where it was very hard for me to to actually drive the technology direction of the company um and uh we figured out that uh it's probably not the best use of my time um so I did this um I wouldn't say like stepped down or like I basically just stepped out of the management uh uh job and uh went into a uh an IC role essentially uh with uh I have some people who are supporting me but I don't manage a large organization anymore and that just increased I think my efficiency and my impact I could have like for the company and for the uh and also for our customers um a lot and then we we hired uh Vice a lady uh who is now running our engineering organization um and she's doing a fantastic job uh in in that so she's she introduced a very good accountability structures uh very structured uh system for how people get rewarded uh we have a I think a very good system now for promotions and she also managed to attract uh some like really key people uh key engineers key ICs uh into the company so she was also great help on on hiring and and building the team uh there so yeah it's uh I think overall just increased the the clarity we have in the organization like who's doing what um and it just freed up a lot of um uh minds for working on on actual problems problem solving uh as opposed to like just managing organization and the results speak for themselves right because our product is arguably the industry leading product it's scalable it's it's um it has massive stability and and is really a leading yeah a leading product um when we spoke a bit earlier today you you said you have a number of learnings from this journey that went all the way back from what was it 2010 yeah so a 13-year journey about your learnings about how to run an organization and how to take an engineering and product organizationally global yeah what what are some of these learnings yeah so so I think the first the first piece of advice I have is if you're getting advice then then think about if that advice is actually applicable for you and like interpret it to to fit to your situation because I think every company is different um and it has its own DNA and the worst thing you can do is compromise your DNA because you think that you have to do something someone else is also is also doing um and uh yeah for us like talking about uh bringing the engineering organization global like from our nucleus and in Munich and from our homegrown team I think the the so there is there is a lot of things which uh we have done right there some things which I think if I would have known we we would have maybe done it differently but in in hindsight that's also always easy so one one thing which is important is that like even even though you might have a distributed organization it's still important to bring people together on a regular basis in person so um we're doing that like when we're when we're doing like planning phases or when we're when we're doing uh yeah just for aligning strategy because you have so much like subtle context which is hard to transport like if you're not in the same time zone um um or if you're not sitting in the same office even um the the second thing is that what what we have learned about like executing projects is um it's very important for everybody to know about all the projects but then executing the projects is much easier if you do it like locally so um um we have uh we have different areas where we are um basically defining is that something which we have to run globally because we need skills from from all parts of the organization is that something which we can run locally and running local is always preferable because you don't have these time zone handovers uh you have a team which can kind of push itself much better um so so prefer running local uh over running global projects then uh one topic which we have covered already uh a little bit in the conversations is make sure that you are creating uh tracks for your key contributors uh which allow them to to be successful um because they're very very important assets for for the um uh for the company so if um uh if you don't have people who in the end like are actually designing the system and writing the code and and doing this then you can have the best management uh you want like in the end the product won't do anything uh anything meaningful um yeah and there was one as well where you said new managers tend to think that they'd have to look out for their team and defend their team but that's not always the way they should act yeah yeah so so that was that was one um I also think one thing which we which we learned along the way is that if you have someone like if you have engineering teams and then uh one of these people is stepping up into a manager they tend to basically fight for their team so they try to protect their team try to protect their scope maybe to some extent they have a very strong attachment to the components which they have built but like for us like switching from a uh on-prem system to uh uh cloud infrastructure to a cloud system uh to a system which doesn't just do analytics but it's also like driving automation to a system which incorporates like AI components and so on and so forth like sometimes you just have to replace components and you have to restructure and and align the organization with this and uh and so I think managers like the job of a manager is to drive the company strategy and to manage the company strategy into the teams of course also helping the people to grow but um with these like internal like promoting people from inside out um I think that sometimes led to a situation where uh they were just like protecting their work or their their baby so to say uh instead of like doing what is uh what is the most important thing from uh from a company strategy standpoint Martin this was incredibly fun and I hope helpful to talk about taking an engineering organization from one person to uh to 650 people around the globe and and we hope too many many more over time so thank you so much for taking the time to speak to us this morning and thank you for your attention yeah thank you for your attention