Software Executive Magazine

OCTOBER/NOVEMBER 2017

Software Executive magazine helps software executives grow their businesses by showcasing the business best practices of our readers, executives from established and innovative software companies.

Issue link: http://digital.softwareexecutivemag.com/i/878720

Contents of this Issue

Navigation

Page 25 of 43

deca employee, was the perfect fit. He had a strong background in services, support, training, account manage- ment, and customer success. "If you think about the way that the company is structured, it's based on the strengths of the leadership team today," Fredette explains. "I'm run- ning product and engineering. Aman is running product sales and mar- keting. All of the customer success reports into Chris, as well as HR and the people side of the things. Legal, account management, and finance report to our CFO. Then our CTO, our third cofounder, Jonathan Grimm, runs the technical side – the archi- tecture and engineering aspects. We complement each other nicely." Toast has a "no ego" edict when it comes to hiring. It's that lack of ego that helped the co-founders realize they needed to hire members of the executive team to fill in their skills gaps in the first place. There's a good lesson here for any soft- ware company. If your background is in engineering, find executives to fill out the business management side of the company and vice versa. It helped that the co-founders had strong relation- ships at Endeca, and they knew Com- parato would be the right fit as CEO. "We talk a lot about the cost of leader- ship bandwidth," says Fredette. "Early on, you're constrained by leadership. You need to be spending less time doing things yourself and more time recruit- ing amazing people who give you more leadership input, so you can do more things." The point is, the co-founders didn't have unrealistic expectations of growing the company entirely by them- selves. They found other people who could help, and they relied on those peo- ple to help them repeat the success they had achieved at their past companies. NEVER STOP ITERATING The Toast co-founders know how to pivot a product. The company probably wouldn't exist today if it had stubbornly stuck with a mobile payments platform the toll booth, the pain goes away. You tell yourself, 'When I get home, I'll sign up,' but then you forget. It's not enough of a pain to do anything about it. It's too dull a pain." In order to make that mobile pay- ment solution work, the company would have had to invest millions in customer acquisition. So, six months into this startup, Fredette wasn't see- ing much traction. "I think anybody doing a startup can be viewed as a lit- tle crazy. My wife certainly thought I was crazy. I sat on a couch and worked for six to nine months. Every day she'd come home and go, 'Why don't you get a job? What are you doing all day?'" The Toast co-founders were still determined to develop software for restaurants, but they didn't think they could build a good solution that would integrate with antiquated, expensive legacy systems. The answer was to start over and build a modern, cost-ef- fective, cloud-based point of sale soft- ware for restaurants. "As soon as we started talking to restaurants about solving that problem, we had huge amounts of interest," Fredette says. "It was like a switch turning on, because we had been trying to go door to door selling mobile payments to restau- rants, and now we go to the same sort of restaurants and the response was just overwhelmingly more positive." How did Toast end up with a 40,000-square-foot office in the trendy Fenway district of Boston in fewer than five years? It took seeking out ex- pert advice, being willing to constant- ly iterate with fundraising and hiring, and developing a long-term under- standing of its vertical market. HIRE FOR GAPS Toast's three co-founders were in their early 30s when the company started taking off. They had an entrepreneur- ial spirit and a knack for product de- velopment, but it takes a lot more than that to run a business. Once Toast got to about 70 employees in February 2015, the co-founders hired a CEO. Chris Comparato, another former En- S T E V E F R E D E T T E President & Cofounder Toast, Inc. TOAST INC. FOUNDERS: Steve Fredette, Aman Narang, Jonathan Grimm YEAR FOUNDED: 2012 HEADQUARTERS: Boston, MA EMPLOYEES: 500+ PROJECTED EMPLOYEES (18 MONTHS): 1,000 TOTAL FUNDING RAISED: $131 million in 3 rounds ACCOLADES: Named to the Forbes Cloud 100 list in 2016 and 2017 2016 Mass TLC Award for Innovative Mobile Technology of the Year EXCLUSIVE FEATURE Executive By A. Sorensen BUILDING A 500+ EMPLOYEE SOFTWARE COMPANY IN 5 YEARS SOFTWAREEXECUTIVEMAG.COM OCTOBER/NOVEMBER 2017 26

Articles in this issue

Links on this page

Archives of this issue

view archives of Software Executive Magazine - OCTOBER/NOVEMBER 2017