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How Atlassian built a $4.4 billion business without sales staff
Tue 8 March 2016 - 10:44 amDigital | eCommerce | Expert | Featured | Growing | Marketing | Marketing | Sales | Sales and advertising | Small Business | Software | Tech
The story of Atlassian is the perfect tech startup fairy tale; two humble guys from Sydney bootstrap a company with a $10,000 credit card and pull off a successful IPO with a market cap of $4.4 billion (USD). Although, contrary to the hopes of many Australian entrepreneurs, the success of Atlassian doesn’t ride on the back of a pumpkin coach or fairy godmother – it’s a story of user-centred design and the never-ending pursuit of an awesome user experience.
By taking a user-centred approach to business, Atlassian managed to operate for seven years without any sales people – and only spent around 21% of its overall revenue on sales and marketing last fiscal year. To put that into some perspective, cloud file-sharing company, Box, spent 82% on these activities for the six-month period ended July 31.
In an article in BRW, Atlassian co-founder Mike Cannon-Brookes mentioned his team “had a hunch early on that sales people break software companies”, and building great user experiences is a sure-fire way to generating positive word of mouth – after all, who needs sales people when your product can sell itself?
Australian businesses are beginning to see the importance of user experience, but Atlassian still stands somewhat alone in the assembly of successful Australian startups.
So, how did they do it?
Atlassian addressed problems that were personal to them. They built products for themselves; tools for teams, from startup to enterprise. This allowed Atlassian to take a user-centred approach to design and rapidly develop valuable products for a market that desperately needed them.
Guide your efforts
Back in June 2012, Atlassian released a new product design language to the world, the Atlassian Design Guidelines. Said to be inspired by Larry Page’s design overhaul of Google, these guidelines help keep the various Atlassian product teams and add-on developers constantly striving for perfect user experiences.
(Source: Atlassian Design Guidelines)
Above are the three guiding design principles which underpin the Atlassian Design Guidelines. They advocate valuing users and using consistent patterns so that they can move between products with ease, focusing on simple and functional designs, and rationalising design decisions so that others can quickly build on them.
“We believe that if the interaction models and patterns from our products are unified, we’d not only give the people using our products some consistency, the designers would be able to work collaboratively with the product teams to focus on customer needs, flow, structure and the bigger interaction problems. The Atlassian Design Guidelines (ADG) is our answer for the design implementation that achieves a consistent user experience for our products.” – Matt Bond, Senior Designer at Atlassian.
Take one step into the Atlassian offices and you will see what a user-centred business looks like. Almost every vertical surface can be written on, and staff are encouraged to put up their work so passers-by can leave comments. They host open feedback sessions; the team call this ‘sparring’. It pushes development and design outside the boundaries of the product teams and aims to give feedback some structure and focus. While it is not strictly ‘user’ feedback, it’s still breaking out of the bubble many teams get stuck in when critiquing work.
They construct ecosystems of creativity. Places where people of all disciplines can contribute to the design process.
Design with empathy
Editor of Designing Atlassian, Alastair Simpson, wrote an awesome article on data-informed design in enterprise products. He talks about how data-driven design (a guideline that shapes many product decisions) is often too narrow a scope to capture great product design. In order to understand the true intentions of the user, you need to add empathy and gut feeling to the mix – shown in Alistair’s diagram below.
Empathy and gut feeling are about focusing on the why and how so that data can be properly interpreted – Alistair composed this article to draw attention to how data can create a fog of confidence around your product if you choose to ignore the voice of your customer. For instance, you might find that your new sign-up process has increased conversion by +15%; a metric to be proud of surely – although, after embedding a live chat through the sign-up to learn how this happened, you discover that a significant number of leads are dropping off because they wished to register with Facebook. Data-informed design helps the Atlassian team “strike the right balance between data, empathy and intuition.” – Alastair Simpson
Taking a user-centred approach to design is one of the best ways to save money and increase your runway. Atlassian lowered their risk by ensuring that issues were discovered and fixed during the design phase and not once the product had been shipped. This also saved them money by flagging elements that weren’t working when it was most cost effective to fix it. In turn, the Atlassian team were able to grow a profitable startup in Australia during a time when access to capital was at its most bare.
User experience is the key
By focusing on users at all times Atlassian were able to grow by unconventional means in a particularly difficult time. They produced products which could sell themselves. They cultivated a team which thrived on perfection – and unlike many businesses in their wake, they managed to succeed without falling victim to the lack of support available in Australia.
If you want to learn more about Atlassian’s awesome design thinking, check out Designing Atlassian.
Credits to Alastair Simpson & Matt Bond of Atlassian
About the author:
Eddie Sartori is lead UX designer at Sugar, a UX & UI design agency in Melbourne. A creative at heart with a background in marketing and media, and a strong passion for behavioural psychology, Eddie has built experiences for companies such as Deliveroo, Startup Grind, and members of the Angel Cube accelerator program.