Interview with Warren Levitan
Speaker Announcement: Talking SaaS Platform with Zendesk’s Warren Levitan
We’re thrilled to welcome Warren Levitan, Senior Vice President and General Manager of Platform for Zendesk as a speaker at SAAS NORTH NOW 2020. We recently sat down with Warren to chat about transitioning from SaaS product to platform, the best advice he ever received, and what attendees can look forward to hearing about at his September SAAS NORTH NOW presentation.
Can you tell us a bit about your career and your success as an entrepreneur in transitioning start-ups to enterprise?
In some ways, my career might be seen as a bit of a random walk. I’ve been a logistics and strategy consultant. I lived through the dot-com bubble, wearing too many hats to count. I built an offshore manufacturing business with plants in China, Vietnam, the Philippines, Turkey and Israel. I’ve led sales and marketing for an industrial packaging business supplying the likes of Coke, Pepsi and Nestle.
As a CFO, I raised $100m in private equity and debt for a high-growth, profitable tech company. I’ve led four M&A transactions, two on the buy side and two on the sell side. I founded and led a start-up as CEO, and now find myself as an executive in a global tech company approaching $1B in revenue and 4,000 employees.
There are two constants that connect my different roles and experiences. First, a relentless focus on the problem to be solved, and explicitly saying “no” to anything that distracted from that focus. Second, creating employee cultures built on the principles of purpose, transparency, empowerment, accountability and candor — all of which I believe are essential to innovation and resiliency in an organization. If there have been any keys to my limited success, these are them.
How did the sale of your start-up Smooch to Zendesk come about?
In 2017, Smooch found product-market fit with a go-to-market strategy focused on licensing our conversation platform to customer engagement platforms (think help desk, contact centre and bot platforms). Zendesk was one of our early customers. By 2019, Zendesk recognized that messaging and the persistent conversations they enable were the future of customer engagement, and made plans to revamp all of its products for this new paradigm. Zendesk could have continued to license our software, but when they considered the upside they saw in messaging and an open platform strategy, it became logical to acquire Smooch.
Can you tell us about Zendesk and your role there?
As SVP & GM of Platform, I champion and drive our platform strategy across every part of our business. Zendesk has evolved from a point-support product to a service-led CRM suite. As a multi-product company, platform is the essential fabric that connects our various applications and experiences. Whether it’s sharing customer profiles and their event-driven customer records, or connecting workflows across applications, platform is central to delivering on our promise of a unified customer experience.
What advice do you have for companies looking to transition from SAAS product to platform?
Platform is a loaded word, so make sure you know what you mean and what you are trying to accomplish. Ask questions like:
- Is your platform strategy intended to help you sell more SaaS through integrations and extensibility?
- Is your goal to build an independent line of business that is API first?
- Is your priority a low or no-code platform that business users and analysts can implement, or are you focused on developers as your core users?
You also need to be clear on your monetization model. Platforms like Google, Facebook, Apple (iOS App Store) and Amazon (.com) are aggregators who collect rent from other businesses for the right to access their users. Cloud and compute platforms like AWS, Azure and Google Cloud monetize their platforms based on direct consumption models. Meanwhile, platform-enabled SaaS (like Zendesk and Slack) leverage platform to extend and enhance the value of their core SaaS offerings.
What are the foundational essentials to building a valuable platform?
Like all cloud software today, security, reliability and scalability are table stakes. Then, focus on the user experience and general ease of use —whether it’s a low code or developer-first platform, documentation, tutorials and the support experience are key. Remember users mean partner developers as much as customers. A platform is generally only as valuable as its partner ecosystem, so never neglect your partners.
What are the issues that most often create challenges for a company looking to make the transition from product to platform?
It is generally easier to build up the stack from platform to application. The other way can be tricky and typically involves some level of re-platforming. Early stage companies can struggle to build their first versions of their product in a platform way as it can be seen as slower and more expensive, but this can come back to haunt you.
Even with product companies, I would encourage founders to think about building everything with an API from the start. Products rarely live in isolation anymore, especially in enterprise software. To embrace today’s heterogenous, multi-vendor IT environments, open APIs are key. But when building product there will always be times when you fail to initially expose a function or service that you later learn you want (or need!) to expose. Don’t delay as the longer you wait the harder it gets. Bite the bullet and clean up that technical debt as soon as you can.
What do companies need to do to successfully monetize their platform?
As above, be clear on your monetization strategy up front. If you are going with any consumption-based billing, think ahead to all the different consumption attributes you may one day want to monetize and try to build that flexibility into your early reporting and billing. Whatever measures you bill on, be prepared to provide the same raw billing data to your customers via API and dashboards. You don’t want your customers to be surprised when the bill comes!
What is the best advice you ever received?
Be accountable for anything you do, and not just the part you touch or are responsible for, but the whole outcome. Accountability is the foundation to learning, and learning is the foundation to success. Environments where everyone is accountable are magical places where progress and learning can happen at light speed.
Can you provide a preview of what you will be speaking on at SAAS North in September? What can the audience expect to learn from your presentation?
If you believe the thesis that software is eating the world, then you should also believe that every enterprise SaaS business must also be a platform business. In my presentation, I’ll explore this thesis, along with its implications.
Don’t miss Warren’s presentation at the SAAS NORTH NOW virtual conference, September 9 – 10, 2020. Buy your tickets today!