What Great Tech Leadership Looks Like: Amplitude Co-founder And CEO Spenser Skates

Welcome to the Growth Cap Podcast, where we chat with CEOs, investors, and other key industry leaders to uncover insights and strategies for accelerating growth and succeeding in business.

I'm your host, RJ Lumba.

At over $100 million in annual recurring revenue, Amplitude has consistently scaled each year since its founding in 2012. The company provides a product intelligence platform that enables businesses to optimize digital product innovation. It serves over 30,000 teams at companies like Walmart, Ford, InBev, Atlassian, Microsoft, Twitter, HubSpot, and Procter Gamble. Amplitude's cerebral yet highly attuned founder and CEO, Spenser Skates, is largely to thank for the company's rapid rise. He is not only a highly skilled entrepreneur, he is a global thinker and proactive leader stepping up in areas for the betterment of society. We cover a wide range of topics spanning Spenser's source of inspiration, his early beginnings as an entrepreneur, and his disciplined approach to consistent scaling. The company is backed by Benchmark, Battery, IVP, Sequoia, and GIC. We hope you enjoy the show.

Spenser, psyched to be chatting with you. Thanks so much for joining. Typically, I have folks dive right into their background as, as well as tell us a little bit about their company, but I'd like to kind of pause here and actually applaud you for stepping up in this, the conversation on race. I noticed kind of it's something important to you, and hopefully I'm not catching you by surprise, but—

No, I appreciate you asking about it.

Yeah, you know, it's on your site, you have the 5 things about Amplitude, and 2 out of the 5 are really about what's happening in kind of today's environment. So Tell us a little bit about Tech for Black Founders and also kind of how you think about diversity, particularly in the context of building your company.

Yeah, for sure, man. Yeah, it's been a crazy time on that. I don't think you've had corporations that are as conscious of this since ever. Since the murder of George Floyd last year, we realized that we can play a big part in driving change in our society. When it comes to issues around race and diversity and making our society a more equitable place for everyone. We've always had a focus of diversity, equity, inclusion at Amplitude since we started the company. For all sorts of reasons, people get overlooked because of their backgrounds, because of who they are, because of how they come across, and we don't think that's right. And so both in building Amplitude as a company as well as thinking about how we make impacts on our community. We've been particularly conscious about that since the start. In terms of Tech for Black Founders, that's one of our programs that we have where for founding teams that have a Black founder, give a special program of Amplitude available. And so I think we have over 50 people or 50 companies that use that to date. And it's been one of these really awesome programs where we've been able to help out and get connected. Oops, sorry, let me close my Slack. Help out and get connected with the Black tech community in, in deeper ways. So that's been fantastic. We've also been particularly conscious of building out, when, when it comes to building out Amplitude's team, how can we get the most diverse teams? Diverse teams, it not only goes to the things I said, but diverse teams are also much more likely to win and build successful businesses. And so that's been a priority of, of ours from the start. And then most recently with the, everything that's going around with attacks on Asian Americans. You know, it's been— as an Asian American myself, that's been really, uh, it's been incredibly sad to see. You know, I have all sorts of emotions about that, but what I'll say is that I take a lot of pride in myself as an American, and so it's super frustrating to see those things happen. And so any ways that we can be part of changing society for the better so that we can fix these things in the future, I'm very much a fan of and a part of. And so it's been awesome to see so many other companies embrace these issues as well. So it's really a different time. I remember even 5, 10 years ago, a lot of corporate America was just terrified on speaking out when it comes to issues of diversity or inclusion or what have you, and would try to be as apolitical as possible. But it's just been phenomenal to see so many people and so many companies really be clear about how they stand and what they want to build society to be like. So it's been awesome to be a part of that movement, and I'm hopeful we can create some real change as part of it.

Yeah, I know it's really phenomenal that you've kind of stepped into this role because it's, you know, a lot of people could say, could also feel similarly, but maybe they're not as bold in kind of taking action. And so I think the step you've taken could be inspiring to other entrepreneurs. No one has a lot of free time, right? So you have to carve out the time and you have to allocate a certain amount of energy to it. But you've done it. And I think, it's inspiring for other people to maybe follow suit. This is all falls in line with also building a good company, as you mentioned. Just kind of talking to you and reading up about you, you, you remind me of, you know, when I was in, I was in business school, I met John Zimmer, who was an undergrad at the time who ended up founding Lyft and becoming really successful. But he also had a fairly broad worldview, and nicest guy you would ever meet, and you could tell that he really cared about what he was doing and, and about people. And I think by being that way, you end up building very successful long-term companies. So maybe that's a segue into, tell us a little bit about yourself, how you got your start, and then tell us about Amplitude.

Yeah, absolutely. So for those of you who don't know me, I'm, I'm Spenser Skates, CEO and co-founder of Amplitude. We do digital optimization systems. And help many companies, including over 20 of the Fortune 100, build better products and create great, great experiences for their end users and connect what they're doing and building in their product to their business. And so it's, it's been kind of a— it's been a wild ride since we started. Just to go way back, I graduated from MIT in, in 2010, and I was lucky enough then to have the option of doing lots of different things with my career. I could have got into investment banking or consulting gone to grad school or gone to a big tech company. And so I spent a lot of time kind of introspecting and thinking about what is it that I wanted to do with my life. And there was this story that really stuck out to me just being incredibly inspiring. There's this guy named Norman Borlaug who was an agriculture expert and did his work in the 1950s. The short of it is back in the 1950s, there was huge problems with food security, just our civilization being able to produce enough food for everyone. And we had a fast-growing population in a lot of the developing world, but not enough food to feed everyone. And so everyone was terrified that we'd just keep growing and that future would be really bleak because there'd be fights over limited resources and mass starvation and all these, all these other things. And, and what he did was he went to a number of developing countries. He went to Mexico, he went to India, he went to Pakistan, he went to a bunch of places in Africa. And he brought modern farming techniques and created really high-yield crops in order to make these places self-sufficient in terms of their food security. So he went to Mexico, he helped them quadruple their wheat production a number of years. He went to India a few years later and did the same thing in India, very, very poor country at the time with a very fast-growing population, and then went to Pakistan and so on. And as a sum total of his efforts, ended up probably saving hundreds of millions of lives. He got the Nobel Peace Prize in 1970. And if you look at the legacy of his work today, today, we don't even worry about having enough food to feed people. Today, our top worries as humanity are things like energy and climate change and other areas. And that's a huge part of it is the work of this one man, Norman Borlaug. And so that was just incredibly— as a 21-year-old who had just graduated college, that was an incredibly inspiring story. And I said to myself, look, if I can have a fraction of the impact that someone like that has on the world, I'll be really happy with, with what I do in my life. And so I actually have a picture up of him on my— yeah, I see it. Um, so it's just kind of a reminder for why what it is I'm doing, you know, I see the technology as this huge lever to improve our quality of lives. You know, if I think of how my quality of life has improved the most in the last 20 years, it's technology. And that goes for most other people in the rest of the world too. And so that was kind of the why I decided to come and start a company. And just to give you the story behind how that translated into Amplitude, so we worked in a few failed companies before Amplitude. We worked on this one called Sonolight, which was a version of Siri, of the Siri app. If you remember back in 2012, Siri had first launched and it was like this big deal because you were using voice recognition as an interface for the first time. So we created a version of that for Android phones. We, um, you know, spent about a year on that, did Y Combinator, didn't end up working out. But through that, we really saw an opportunity and what was going on in, in kind of the broader internet where the internet was shifting from a marketing-centric internet with lots of content to an application-centric internet with lots of products and interactions. And, you know, every company was trying to bring, going through digital transformation to bring their products online. And so we said, hey, there's gonna be a massive set of infrastructure behind all this. That's going to need to help people build these products. And so let's go do that with Amplitude. And so that was the start of Amplitude in 2012. We launched the company in 2014 and it's kind of taken off since. And it's just, we've been incredibly lucky to kind of just be at the right time and right place with the right product. And since then be incredibly successful. We passed $100 million annual recurring revenue last year. Like I said, we work with over 1,000 customers today. We have over 15 customers that do $1 million or more of business with us right now. Some of the largest companies out there, IBM, Walmart, DoorDash, others. And so it's just, it's been awesome to be able to create something that has so much impact. And then back to your first question on some of our impact when it comes to diversity, equity, inclusion, and issues around in our society, like that's a huge way that, you know, I make impact and we make impact as well. And so for us, it's just like, okay, let's keep this thing going and let's, we see this, this multi-billion dollar opportunity., to build the, the system of record for digital products and to help businesses optimize their products and, and connect what they're building to the success of their business. So that's the, that's the really short story of, of how I got into tech and started Amplitude.

Yeah, well, clearly you have a very sophisticated platform when you have some of these large Fortune 500 companies that are, you know, kind of celebrating your technology. You have Walmart and Ford and InBev that talk about how they use your, your system. So what a company like Walmart, obviously there's a lot of directions we could go in and how they're tapping into kind of mobile engagement. But, you know, what would you think would be helpful to kind of highlight for someone trying to better understand how your technology gets leveraged?

Yeah, so let me set it up, which is right now people are spending— companies are spending millions, tens of millions, hundreds of millions of building these digital products. You're releasing new features, launching new campaigns, making tweaks to the interface. But you have no idea how any of those translate to your business. So how is it that the launch of this new feature, is that causing more people to engage and retain and, and become users, or less? You know, people have no idea. And so that's at the core of what Amplitude does. We help, you know, in the example of Ford, one of the interesting things is Ford is really thinking a lot about how to reinvent their customer experience, right? So they, they have traditionally thought of their customer experience through their cars, but now they think a lot of that through their online, their mobile app. It's a really big shift for them as a company because, you know, they haven't seen themselves historically as experts on online. But one of the things they realize is that's where all their customers are spending time. So whether it's to schedule a maintenance and repair session for your car, whether it's to, to be part of a loyalty program, whether it's to get roadside assistance, you know, all sorts of things. If you have a problem with your car as a Ford owner, first place you're going is the app. And so the team there saw that, and they said, hey, we need to invest in this, in the success of our online app, as a major piece of the future success of our company. Because we can make best cars all day, but if people aren't engaged with us as a brand, it's not going to matter. So they found Amplitude a few years ago. They had a lot of questions around, OK, well, How do I actually understand how is it that people are using the application and how is that translating to whether they're becoming a loyal, engaged customer long term? And they had no idea how to answer the question. They had data across lots of disparate silos within their company, the different teams sitting with different pieces of data. They had no way to unify what was going on in their product to what was happening in their business. And so that's when they came upon Amplitude and we've helped them do that over the last few years and found some, some really awesome success in creating one of the automotive industry's leading applications. So that maybe, for those who are not familiar with Amplitude, is a, is a really high level of, of what we do.

As, as you're kind of explaining that, I was, I couldn't help but think, well, it's, it's very difficult, first off, to land some of these large enterprises as customers, but then also at the same time to scale your business to over $100 million in revenue, what, what has been, do you think, the most challenging aspect to getting to where you are today that maybe you hadn't foreseen?

I mean, there's so much that, but I'll boil it down to, to one theme that's, that's come up and up again and again for listeners, which is people talk a lot about scaling companies. So, hey, let me do— when I think of scaling something, you're thinking of, okay, well, I'm going to do the same thing. I'm just going to do it lots of times over and over again. So I'm going to take this thing I did here once and maybe replicate it 10 times. Hey, I got one customer, I want to get one new customer. How do I get 10 new customers? How do I get 100 new customers? But what the word scaling really misses is you're having to rebuild and reinvent your company at every stage of growth. Like a company at $1 million in ARR is so different from a company at $5 million, is so different from a company at $30 million, is so different from a company at $100 million, is so different from a company at $300 million. Million in revenue, you're having to basically take apart and rebuild the entire company. And that means new leaders, new systems, new organizations, new processes, new ways of doing things. For a company like Amplitude that we're growing 50% year over year, which means every 2 years we're doubling, which means every 2 years it's an entirely new company. It's just like you have to almost rebuild a lot of it from scratch. That's a really unnatural thing to do. Exponential growth is a really unnatural thing to go through. Like, the CEO job is, as a first-time founder CEO, it's hard enough that having to learn it all over again every year or few years, it's really challenging and really hard. It's not like there's an equivalent of med school for founders where it's like, oh, yeah, go get your degree and learn all the things you have to do as a CEO. So the thing that's been incredibly valuable and that we've been very lucky to have is the support of advisors who have done it before. So in particular, some of our board of directors has just been absolutely phenomenal. A great example is Eric Vischeria from Benchmark, who I've been working with. He did the Series A back in 2015. We were $1 million in revenue at that point. So we've scaled over to 100x today, and I have learned the most from him about what it means to be a great CEO. So how do we get leaders who can keep up with the constant growth of the business? What are the next strategic, the big strategic issues around the corner? How do we deal with— how do you hire someone that's, you know, I need to hire people that are much more experienced than me on my management team. So how do you evaluate and hire the right people and find them? That's a huge challenge. Who am I to figure out what is a great sales leader? What is a great product leader? What does a great marketing leader look like? Those are things I've never seen before.. And so the only way that I've been able to learn so quickly about what it means and what it takes is through the advice and counsel of phenomenal people like Eric who have gone through it before and have had that perspective from working with other great founders and, and other great CEOs. That would be the biggest thing I'd call out. No question, if, if it weren't for the investment of people like that, it's like there's no way, you know, we would've figured out, you know, all the things that we have.

Yeah, I mean, you know, what you explain, having to rethink your business every couple years to keep up at that rate, that means you're already starting to think about— because that takes time to implement, right? So you're already starting to think way in advance how you're going to be rebuilding. Or I guess, is this more a gradual process where you're constantly thinking 3 years ahead?

Yeah, I mean, you're always trying to, like, you're always trying to— I mean, there are times that are really intense where it's like you have something on fire. It's like maybe a key executive leaving or not working out, or, you know, you lose a critical customer or you're trying to raise a round of funding that are kind of like inflection points. And then there are other times where you're kind of planning longer term. You're thinking a few years out. Like, so one of the things, as an example, I like to do is I write up a document when we're doing planning for the next following year. I write up a document talking about where Amplitude is going, over the next 3 to 5 years to help everyone at Amplitude understand, okay, here's the things that we need to think about, you know, here's the sorts of goals we should have, we want to have. And so that, you know, there are times like that too where you get to have longer-term thinking. So it varies a lot. The key challenge, one of the other ways to, to look at it, maybe if you're doubling every 2 years, that means like every week you're growing call it 1%. And so I have to think about how am I adding 1% to the value of Amplitude this week, every week, compounding until, until forever. But that's, that's the fun. Some people, some CEOs, the other thing I'll say is some CEOs can get really tired. You'll see a lot of founder CEOs that maybe after 10 years they'll decide to call it quits and sell the company or hire someone else as CEO. One of the things I really appreciate is that no matter how big you are, there's always a new challenge in front of you. And I see this as kind of a lever for doing this enormous good in society. And so I'm always really excited about learning that new thing and getting to that new height and building Amplitude for that next level. Yeah.

You know, recently I was— I don't know how this came up. I was on a trip and my wife hadn't read or listened to the Steve Jobs biography by Walter Isaacson. And there's a part in it where It talks about he would go on these walks and people would visit him and he'd have these conversations. And in the morning he'd be very bullish about his business, thinking about how awesome everything is going to be. And then by the time the afternoon hit, he was kind of like demoralized, saying like, oh my God, this is never going to work. This is like, this is horrible. I don't know what we're doing. Do you ever have moments like that? Or you've kind of managed to— you seem like a level-headed, you know, you're kind of like even.— but trying to get into what it's like being an entrepreneur that's scaling rapidly.

Yeah, you know, there are definitely moments that are incredibly frustrating or that there are problems you're just like, how on earth are we going to tackle this? One of the things that's been really kind of instructive to me is that if you just look at the history of successful companies, they all go through that, you know, whether it's Apple or Microsoft or Amazon or whoever. Or Oracle. And for us, as long as you don't quit, like, that's the top thing. Just don't quit. You know, it's like problems are never as bad as you feel about them in the moment. There's always a way through them. Just being willing to continue to get up every day and take enough swings at bat, like, eventually you'll find success. And that's kind of the beauty of this thing, is that, like, even if I have a few weeks in a row where instead of adding that 1% compounding growth, I don't do anything, that's fine. You know, I just keep doing the next few weeks and you will you'll figure out a way. And so that's definitely one of the underrated aspects of CEO psychology that's really important. I think the other part of it is you need to have that belief. If you have a CEO that doesn't have that, that's actually a real problem because the CEO needs to be the person who is the most bullish on the company out of everyone. And that's not to say you can sometimes get demoralized or beaten down by whatever problems, but that energy, the team and the, the organization and the investors and customers and everyone around the table ultimately looks towards you for that. And so the great thing is, like, I, I, I always compare it to what did young people my age have to do 50 years ago? Well, a lot of them were being drafted to go fight in Vietnam, and it's like, you know, this is a cakewalk compared to that. You know, we get paid a lot of money, you know, it's stressful, but all things considered, it's relatively cushy job and lifestyle. We get recognition for what we do. You know, we can take breaks from the thing. And so like compared to stuff like that, I always try to have some perspective on life like that. The job, while it could be very stressful in the moment, relatively speaking on, on the scale of stuff that can happen in life, it's pretty mild.

Well, we're coming up on time here and this has been an awesome conversation. I typically end with two questions, but you've already answered them. One was, was related to kind of people you've admired, uh, you, you actually responded with a couple people, and, and also a challenging moment, which you've also answered. So maybe what we could do is end on, tell us a little bit more about your vision for Amplitude. And I think you made an acquisition, and so maybe that kind of folds into that question.

Yeah, yeah, for sure. Our big thing is how do you connect what you're building in the product to the business? And so we think about how do we help every single company across the spectrum, whether you're someone who's really bleeding edge, you know, in tech and is used to all the latest and greatest, or whether you're a company that's, that's learning digital for the first time, like a lot of the traditional enterprise. And we help them connect what they're doing in the product to the business. It's kind of crazy. You know, historically, when you build a product, people see it as a revenue center. You're spending all these things building your product and you have no idea how those are translating to the success of your business. Is this feature I built actually engaging more users and leading towards a new and a greater customer lifetime value? You have no idea. And so we think of ourselves as, as solving that, that fundamental problem. I think there's kind of 3 big aspects to how we do it. One is, is to go deep on data. So really invest a lot of time in understanding data is just essential to make that successful. The second is unsilo a lot of these different data sources. So like instead of having your marketing team only thinking about marketing and product team only thinking about product, how do you look at the user journey end to end? And then the last is just doing that on a single, single infrastructure. And so the exciting thing about that is there's an opportunity to build that massively successful company that will be doing billions of dollars in revenue and will be one of the great B2B SaaS companies. And we're going after it and we're just really excited about all the customers that have bought into that along the way.

Awesome. Well, Spenser, it's been an absolute pleasure speaking with you and wish you the best of luck in the years ahead. And I know our audience will find this conversation very insightful.

So thank you. RJ, it's fantastic to meet you. Thank you very much again. Really appreciate it.