10 questions for Atlassian president Jay Simons

Atlassian, the company behind enterprise software like HipChat, Bitbucket, and JIRA, went public this week, raising $462 million in its initial public offering (IPO) and picking up a solid pop in its stock market debut. It was probably the last technology IPO of the year, and a big one at that.

Established in 2002 and based in Australia, Atlassian initially focused on selling licenses for software that could run in companies’ on-premises data centers. It introduced cloud services in 2011. The company has remained profitable through that transition.

Atlassian brought in $85.8 million in subscription revenue for the year that ended on June 30 — 26 percent of the company’s total revenue for that period. At that size, it’s probably fair to put the company in the context of software as a service (SaaS) vendors that have gone public. Others SaaS companies that have gone public over the years include Box, HubSpot, New Relic, Veeva, Workday, Zendesk, and, of course, Salesforce.

On Thursday, a few hours after representatives from the Atlassian team rang the opening bell at the NASDAQ, Jay Simons, Atlassian’s president, took some time out to speak with VentureBeat about the company’s past, as well as its future. Simons, who works closely with Atlassian cofounders and co-chief executives Scott Farquhar and Mike Cannon-Brookes, has a very good handle on the company, having been there since 2008, initially as its vice president of sales and marketing.

This interview has been edited for length and clarity.

VentureBeat: The five core values of Atlassian are pretty interesting: Open Company, No Bullsh*t; Build with Heart and Balance; Don’t #@!% the Customer; Play, as a Team; and Be the Change You Seek. How did they come about?

Jay Simons: Have you read the book “Good to Great,” by Jim Collins? He talks about this exercise: If you were going to colonize another place, pick the people who are going to set up shop and create a landing point for the rest of you to go to. When we created our values, we ran a similar exercise to identify what we stood for to try to create an enduring DNA that we could share with future Atlassians. When you’re a small company and you’re growing, as a CEO, you’re involved in every interview and every decision. Eventually you scale past the point of being able to do that. The values have helped the company scale in the way you, as a CEO, want it to scale.

VB: How have you put the values into practice?

Simons: For “Don’t #@!% the Customer” and “Open Company, No Bullsh*t,” one of the best examples is that, really early on, there was a highly requested feature from a bunch of customers. We felt like that particular feature would have a negative impact on a lot of other customers. We basically wrote a blog post and said, “We’re not going to do this.” The communication basically said that if we stand by our values, we think broadly of Don’t #@!% the Customer as the entire customer base, and so that was a good example of both being open and transparent and putting the customer first.

For “Play, as a Team,” for this particular event, we brought all the people who have been with the business for more than 10 years, and I think that’s a true celebration. It’s not just executives in suits and ties. We brought a dozen or more people that had been with the company for 10 years, and a lot of them went all the way from Australia to Manhattan. It’s one of the farthest flights you can take from Sydney.

VB: What lessons have you learned about selling enterprise software?

Simons: I guess the best one is that it’s okay to fuck convention. Sometimes when you grow up in enterprise software in Silicon Valley, you hear the way things should be done or the way they’ve always been done. The market today is maybe recognition of a different way of thinking. We’re a company that has never raised institutional capital, with 10 years of profitability and free cash flow. We distribute our products online without a bag-carrying enterprise sales force. In the eight years I’ve been here, there’s a lot of value and there’s a lot of specialness that can come from thinking differently about things.

The only other one is enterprise software can’t sell itself. Enterprise software has always been marked and marred by traditional approaches. You can name any big enterprise software company, and one of characteristics is it requires a lot of explaining, and it requires a lot of hand holding. We approach business software in the way consumer companies do things, and then we price it affordably. Enterprise software doesn’t need to cost millions and millions of dollars. I think that’s another convention that we’re breaking. Hopefully, today is a celebration of that, too.

VB: Why go public if you’re profitable?

Simons: The short answer is that we’re building a long-term company, and we’ve been around for 13 years, and we feel like we’re just beginning. We also wanted to be a best-in-class company. We believe best-in-class companies operate on a public stage. This, for us, is definitely just a waypoint; it’s a mile-marker.

VB: What is the biggest challenge in expanding the company these days?

Simons: I think the challenge for any high-growth company is always going to be people and culture. There’s a war for talent globally, and so finding and attracting people is always going to be the biggest challenge.

I think we’ve got a leg up where we’re built on values, and I also think we have an advantage in the way that we have a significant presence in Australia. It’s a place where a lot of people want to live.

VB: Are more acquisitions coming?

Simons: We’ve had a history of small technology acquisitions, and I think you’ll probably see that continue. We’re always looking to augment our capability or add new technology or technology DNA to the business. We’ve never really acquired businesses with a lot of revenue, but we’ve helped them grow successful businesses from small seedlings.

VB: What’s next for Atlassian?

Simons: Hopefully, the company is going to continue to grow. We’ll continue to refine our products and focus on building incredible products that customers desire. And hopefully, we’ll continue to grow the customer base and make a difference in how companies work everywhere.

VB: What software do you personally admire?

Simons: I use Chrome. If you were to look at my Chrome on any given day, you’d see 30 different tabs open. Twenty-eight of them are open to Atlassian products. One of them would be open to Gmail. Another one is open to Google Calendar. Most of what I do everyday is deeply embedded in how I work with our own products.

Outside of that, I admire Amazon Web Services (AWS) and Amazon. I set up a Minecraft server on AWS for my 11-year-old and my 7-year-old. It saved me from having to run a machine in my house, and it was relatively easy. I was surprised by how much the bill was. I had to think about that for a second. But in some ways, what Amazon is doing with disrupting the hardware industry, we’re trying to also do for enterprise software.

VB: What was the biggest mistake the company has made over the years?

Simons: Our first office in the U.S. was opened in Manhattan. The two founders flew to New York, and they were like, “Yup, we’re opening a U.S. office in Manhattan.” That lasted six months. We realized it actually wasn’t a great place to open a technology company. They basically shuttered the office and moved west and opened a San Francisco office in 2006. I think they thought, naïvely, that if you could make it here, you could make it anywhere.

VB: Did you learn anything new today?

Simons: We were outside in Times Square for about a half-hour, and every single billboard had an Atlassian logo on it while we were out there. It was like somebody turned the lights on in the room. And then, everything all of a sudden went to, like, Gap. “Oh, God!” It felt wrong. It was a shocking reality when they flipped to a different advertisement.