From Vision to Venture Ep. 02: James Hirst, Co-Founder and COO at Tyk
From Vision to Venture Ep. 02: James Hirst, Co-Founder and COO at Tyk.
Moesif’s Podcast Network: Providing actionable insights for API product managers and other API professionals
Joining us is James Hirst, Co-Founder and COO at Tyk, an API Management Platform and Gateway. In today’s episode, we’re going to chat with James about some of the challenges that he’s faced as well as some of the big wins they’ve had over at Tyk in the last few years.
Matt Tanner, Head of Developer Relations at Moesif, is your host today.
Listen to the episode on SoundCloud above, watch it on our YouTube Channel or download it on Apple Podcasts, Google Podcasts, or wherever you listen to podcasts.
Table of Contents
- 00:00 Introduction
- 06:30Significant Challenges as a Founder
- 14:08Tips for Founders - Funding
- 17:51Recommendations
Introduction
Matt - Hey everyone, welcome to the Vision to Venture podcast. Today, we’ve got James Hurst from Tyk joining us and he’s gonna give us a bit of background on Tyk and himself and then we’re gonna dig into some of those great founder questions that we’ve been looking forward to, such as some significant problems that you faced or challenges and kinda how you solved those. And then we’re also gonna dig into a couple of tips and tricks for other founders or aspiring founders that you’ve learned that you’d like to pass out to others that are listening into this podcast. So James, welcome, thanks so much for joining us. There’s a little bit of a time difference between the two of us, but I’m really happy that you’re able to jump on.
James - Thank you, Matt, it’s great to be here.
Matt - Awesome, so in this first two minutes here, since we’re gonna try and limit everything to about 10 minutes, in the first two minutes, let’s cover a few things. So the first thing that I wanna chat about is who you are, a little bit of background on yourself, and then I’d love to hear a little bit of an intro on Tyk and some of the problems that you’re tackling over at Tyk.
James - Sure, okay, thanks, Matt. Well, I’m James Hurst, I’m co-founder of Tyk. I’m based here in London in the UK. Background, I’m a law school dropout. I manage less than a year at law school. I found it a little bit restrictive, a little bit boring. And in parallel to that, I’d learned how to use a dial-up modem, ’cause it was the 1990s, and I found a dial-up internet company who would take me on as a junior. Well, I figured out what I wanted to do with my life, and pretty quickly realized what I wanted to do with my life was work with the internet, ’cause it was pretty exciting. So I launched a web design agency in the UK, ran that for a few years, doing music festivals and online video, and eventually went on to be the director of a digital consultancy in London, which is where I met my co-founder, Martin Buur, and we later founded Tyk together. So that’s how I ended up chief operating officer of Tyk.
Matt - Awesome, awesome, yeah. And what we’ll look at next is, what exactly is Tyk tackling? So I mean, being familiar with Tyk, I know lots about it, but for those who are unfamiliar with Tyk, what kind of space are you working in right now, and what are the main challenges that you feel like Tyk is tackling?
James - Well, we’ve been trading for about seven years now, but I think it’s really useful to understand why we got started, ’cause that really tells the story of what Tyk is trying to tackle. My co-founder, Martin, at the time, was trying to build a load testing platform, and his idea was to build something that was multi-cloud, that was containerized, that was auto scaling, that was very resilient, and his hypothesis was that by building a load testing platform of that type, he’d have a technical advantage, which would give him a commercial advantage, and he could take a bit of that market share. And this was, I guess, 2013, 2014, when all of those terms, containerization, and Docker, and multi-cloud, was brand new, cutting edge. I mean, that was just a roster of buzz terms. And to do that, he realized he needed to build everything API first. And at the time, there was no platform that helped him do that. Everything that had been built to deal with APIs had been built for telcos, and banks, and these big organizations dealing with really big regulation. Nothing that really respected the world of cloud, of containers, of developing fast, and scaling quickly. So he built his own API management layer. He built his own API gateway, which he made open source, and then built some code around it, so to manage it, to monetize it, to monitor it. Anyway, long story short, the load testing business didn’t go anywhere. It was a very stocky business, because it’s all about very tight margins, and no matter what technical advantage you have, there are some behemoths in that space, and he shuttered that business. But the open source gateway hit at the right time, because he wasn’t the only person who was looking to build products, businesses, services that were API first, were built for this cloud native world, as it’s now called, where everything is containerized, everything can move seamlessly, and scale seamlessly across clouds. And so it just drove adoption, and pretty soon, we saw banks, and big retailers, and big media companies, telcos, the people who were using the old legacy system moving onto ours, and that’s when we launched Tyk. And so Tyk has continued to do the same thing. Tyk has continued to be a platform that enables engineers, developers, architects to build resilient, performant, secure API infrastructure, and allows API product owners to take an API first product, and take it to market, get it out there, get it consumed, get it managed, and make money off it. And so that’s where Tyk came from, and it’s a great place to be, because APIs really are just eating the internet, everything is API driven, and we get to work on some really interesting use cases.
Significant Challenges as a Founder
Matt - Awesome, that’s a great background for us. So based on that, you talked about how Tyk has scaled up. In that scaling, I’m sure you’ve come across a few more than significant challenges. Many of us in the startup space know it’s not without its pitfalls. What would you say, whether it’s from the inception of Tyk through to now, what would you say is one of the more significant challenges that you faced as a founder? This could be a personal challenge that you faced in that business, or it actually could be something that you faced as a business as well.
James - Okay, well, I guess as a founder, every day is just challenge after challenge after challenge, and that in itself is a big thing to get to grips with. You’re constantly being challenged, and that takes a degree of mental resilience, and a support network around you to navigate that over time. I think something that’s probably applicable to anyone who’s looking at scaling a business right now is it’s very difficult to instill, develop, and maintain a culture within a business, and culture’s a misused word sometimes, I think, within businesses, but it’s so important. I think the culture of a business dictates how people respond in the face of adversity. It dictates how people progress, and innovate, and collaborate. The culture’s central to all of that, and yet it’s a very intangible thing, and I think it’s often, culture’s often seen as, I don’t know, the relaxed dress code in a business, or the fact that the business goes out for a few beers after work, or maybe they have a ping pong table in their basement, or whatever, but actually, we’re a remote first business, so I’m in London, and my co-founder is in Auckland, New Zealand. We are antipodes. We couldn’t be further apart on the globe if we tried, and our team is spread across 24 different countries. We’re on every continent in every time zone, so we rely heavily on culture to enable people to get things done, to know how to collaborate, to know how to deliver results, because we don’t have someone sat next to all of our teams in all of these places telling them how to do it. They have to make those decisions themselves, and culture’s what guides it. Now, our definition of culture we took from some smart people at Harvard Business Review, I think, is it’s how people respond when the manager isn’t in the room, and if you dig into that, you realize that a lot of it comes down to access to information, and what level of comfort people have with taking autonomous decisions. Some companies restrict a lot of information, very command and control, everything’s by rote, everything’s by checklist, everything is on rails, and that’s the culture of the business, and it delivers results. Other cultures, such as ourselves, because we’re asynchronously working, because we’re default remote, we rely actually on a lot of transparency, a lot of visibility of all the business metrics, because someone could be waking up in the morning in Colombia, or Nigeria, or Singapore, and have a customer question. We don’t want them to have to wait until someone else in their team wakes up in eight hours time, we want them to take a decision, and take a good decision. So, building a culture like that, making sure it’s understood by people, and delivering it through tangible policies, and information sharing, and backing people when they act the way you want them to act, is really important, and I think it gets overlooked. I think it gets seen as, oh, it’s a people thing, it’s an HR thing, the really important thing is the spreadsheet, but actually, culture’s central to all of this. So, that’s been a real challenge for us, ’cause we are default remote, and our culture’s evolved over time, but it’s something we spend a lot of time thinking about, and is probably the thing that occupies most of the founder’s time, is the culture developing well, is the culture developing results, and if not, how do we adjust it, how do we tweak it?
Matt - Gotcha, no, that’s great. Now, one thing that I really like about Tyk is this idea of, I believe, if I recall correctly, radical responsibility, where everyone really is responsible for their output, and I think that’s a great response to this type of challenge, where making sure that things, that everyone is working in the way that they want to work, but also making sure that the way that they’re working is delivering the results that they’d like.
James - Yeah, I think you have to be very intentional in the way that you describe these things, and you set these things out, because that isn’t for everybody. Not everybody wants radical responsibility in their role. Some people actually prefer to have a little less radical responsibility, ’cause it can be quite confronting, it can be quite stressful, it puts a lot of onus on yourself, but for some people, it’s ideal, and it helps them flourish, and so right the way from the recruitment process, if you’re clear on the kind of culture you’re trying to build, and the kind of working practices that will support that culture, then it helps you hire the right people, so that you don’t have people causing friction against that culture, and radical responsibility is a term we use, that we try to call that out, we try to make it very clear to people that in the same way that we don’t measure the hours you work, we don’t measure where you work, we completely trust you to be responsible to deliver the results that we need to deliver, in the same way that there’s that total trust in that, what comes with that is total responsibility as well. If you’re gonna work a certain number of hours, a certain working pattern on certain days, then it’s on you to make sure the results come out, it’s not on someone else, and I think examples like that, that you can put out, you can explain to people clearly when they join, means that the culture can kind of flourish, and it’s not just a, what you sometimes see, which is a motivational poster on a wall, or an onboarding pack that people read on day one, and then never go back to, instead saying to people, “Oh no, no, you can work whatever days you want,”but you are responsible for the results, “so make the choice wisely.” That says a lot more, I think, than telling people that we are a family, or so on.
Matt - Yes, yeah. (laughs) No, that’s cool, I mean, not just putting out the statement, but also living by that statement, it sounds like that, and you know, you and I have probably both worked at a number of places where that isn’t, there’s a statement on the wall, and the reality of it is completely different, and it’s really great to see that Tyk is living to the words that they put on the wall.
James - Well, we try to, and I think it’s important, because it’s, this is something that founders have to do, because there is no correct culture, there is no one culture that is better than all the others. It’s situational, it’s personal, it’s something you create, and you develop with your team, and so it should be a primary focus for a founder, is what kind of culture do we want, what kind of business, do I always want to be signing everything off, because it gives me total control, or do I never wanna sign anything off, and do I wanna have that level of trust in my people, and you know, you gotta pick your own way through this.
Tips for Founders - Funding
Matt - Right, awesome, well let’s move on from that, and head over to some tips and tricks that you can give to other founders. I would love to hear something around fundraising, ’cause I know that, I believe it was last year, was it last year that you guys raised to Series B?
James - Just before that, it was the year before, I think, about 18 months ago, we raised a growth round, a significant growth round, actually.
Matt - Right.
James - But initially, we started out as a bootstrap, the first three years of Tyk’s existence, we were a complete bootstrap. We started an open-source project, which is where the traction came from, then we started as a side project, so my co-founder and I would work evenings and weekends, pitching to our first customers, securing our first contracts, getting a few customers on-boarded and running, and starting to generate some cash, and at that point, we realized, actually, we can quit our jobs and make this a full-time job as long as we continue to deliver cash. And so, first tip on fundraising is, if you can be in a position where you don’t need to fundraise, in other words, if you can generate cash, no matter how much cash, just some cash, that’s a really powerful statement, because when all’s said and done, the most critical factor in any business is, do you have any cash? And telling people that you will have cash in the future if I can have some investment is a different pitch to, oh, we have cash, but we’d like your investment to get more cash. So I would often encourage folks to maybe think of the fastest way to deliver cash and see if you can do that without raising funding, and then look at the funding round afterwards. It’s easier said than done, but it’s worth exploring, because it fundamentally changes the relationship to fundraising, if fundraising is an accelerator rather than a gate to reaching cash flow.
Matt - And when you were looking for those initial customers, so obviously early adopters can sometimes be hard to come by, what kind of pattern were you looking for? ’Cause obviously you wanted to get some cash coming in, you wanted to leave your current full-time jobs, so were you looking for larger contracts and fewer of them or lots of smaller contracts?
James - Honestly, we didn’t care. The key thing at the start is you’re just trying to find that product market fit, and you may have an idea that our ideal customer is X, but until you’ve secured a few and worked with them and developed the relationship over time, you can’t be sure. So actually our starting point was, we went to the community of users that we built and were supporting on the open source, who were paying nothing, but were using it, and we just scouted them out. We just contacted them, found out what they were doing, identified areas where actually our paid offering, which sat on top of the open source, might offer some value and set up some meetings. And in fact, our first few customers, I think our first few customers were a bank and a very well-known networking company who paid significant sums. In parallel to that, we then signed up a few people who were paying 50 bucks a month. And over the course of Tyk, those different profiles of customers have both been valuable to us and continue to be part of the mix. So I think in the early days, you want to go broad, you want to go wide, you want to build as many relationships as possible, learn as much as you can, and then figure out which are the ideal customers, ’cause day one, any customer is ideal.
Recommendations
Matt - Awesome, now that’s great insights. One last thing I want to ask you is, if you had to recommend a book or a podcast or something to a founder or aspiring founder, which would it be? Maybe one that you’re reading right now or one that kind of started you off? It’s usually a tough question, right?
James - Yeah, I occasionally read kind of business-focused books and strategy-focused books, and I think I hesitate to recommend any, ’cause there are so many out there and there are better people to recommend that than me. Actually, what I’d recommend is it’s useful as a founder to get some escapism. I’d recommend “Exhalation” by Ted Chiang. It’s an amazing book, a collection of short stories, thought-provoking, gives you a mental workout that isn’t related to sales or product development. And of course, keeping diverse interests and keeping a good, broad view of life is just as important as doubling down on the unit economics of a business. So I’d recommend that as a broad-term thing. The only business book that permanently sits by my computer is “Good Strategy, Bad Strategy,” which is a great primer for what is strategy and how is it misused and abused and have some really great case studies. So if someone’s looking for a business-focused book, good strategy, bad strategy is a great starting point. Otherwise, go to Ted Chiang. He can change your perspective on life in many ways. It’s great.
Matt - Awesome, thank you so much for your recommendation. And James, thank you so much for joining us on our podcast and look forward to chatting with you in the future. If anyone wants to get ahold of you to chat more, where’s the best place for them to find you?
James - They’ll find me everywhere. Find me at tyk.io and use the contact form there. You’ll find me on LinkedIn as James Hurst. You’ll find me on, I may still be on Twitter. Are people still on Twitter? I don’t know, @hirstys. You’ll find me there.
Matt - Awesome, thank you so much for joining and we’ll chat with you soon.
James - Thanks a lot, Matt, I appreciate it.
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