How Netlify CEO Matt Biilmann Went from Being Self-taught to Bootstrapping a Company
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🎙 About the episode
Meet Mathias Biilmann 🇩🇰! Matt is CEO and Co-founder of Netlify, a cloud computing company you might have heard of. He's also a self-taught developer who was a music journalist in a past life! In this episode, he talks about bootstrapping a company, and hiring his first developers. He also talks about how he initially learned to code and, eventually, decided to change careers! Yes, this story will also take you to the time before everybody had Internet.
Matt will teach you how to best position yourself as a developer, and why companies in different stages of their development look for different things in their hires. Alex and Matt will discuss the current state of the job market and whether you should be worried about the potential for finding job opportunities. And on top of that, this episode is also about the fascinating story about the inception of a company we all know and love.
🔗 Connect with Matt
- How Matt started fiddling with a Commodore 64 before becoming a developer was cool (02:07)
- How you would learn coding in the era before everybody was connected to the Internet (03:56)
- Matt pursued musicology, comparative literature, and cultural studies degrees and worked as a freelance music journalist! (05:40)
- How Matt kept coding as a hobby and decided to switch careers after meeting a girl from Spain (06:10)
- Matt’s first notable coding projects: a Sudoku game where you could challenge friends like in Wordle, and a procedurally generated space game (07:24)
- How Matt got his first developer job (09:29)
- Break: Here’s what our community is saying! (11:50)
- How Matt Biilmann went from being an employee to CTO to CEO (14:28)
- Matt had a hunch about the future of the web… And it turned out he was right! (17:04)
- What is Jamstack? (20:38)
- How much code does Matt write today, and how much did he use to write in Netlify’s early days? (23:32)
- What was Netlify looking for in the first developers they hired? (25:45)
- What kinds of developers do early-stage startups need? What are the differentiators between developers with similar backgrounds? (27:57)
- Break: Subscribe! (31:37)
- Why do companies still need to hire junior developers? (32:19)
- Are junior developers a good investment? (37:03)
- Why are there tech layoffs happening right now? (37:49)
- Should you be worried about the current state of the job market? (44:28)
🧰 Resources Mentioned
- Netlify Drop, formerly BitBalloon
- Scrimba Podcast: How to Avoid Burnout, Improve Your Confidence and Keep Coding Fun, with Scrimba Student Sylvia
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Alex Booker (02:04):
Matt Biilmann (02:07):
So I'll date myself a little bit here, but when I was a kid, there was not a lot of a concept of being a software developer. It was pretty early in a lot of these things. I got a Commodore 64 when I was 10 years old and just immediately got hooked on the basic magic of it. This thing that you could write something that you could then interact with or you could write something that would make stuff happen on a screen as if you had somehow control over some magical virtual universe. Even the most basic things. The language was called Basic, and it was a pretty simple machine and pretty simple model. So I just immediately got incredibly hooked on that and was spending a lot of time as a kid with computers and both of course playing video games and stuff like that, but also building things with computers and trying to figure out how they worked and understanding that.
So my initial interest was really not from any kind of, this looks like an interesting career or something, but just from the pure curiosity and joy of being able to build stuff out of nothing. In fact, I grew up in a family that were very involved in the culture and the arts and mom that was a pianist and a teacher at the Conservatory that was a radio producer and presenter focusing on classical and contemporary music, and I think a lot of my family at the time were really worried of, oh, this kid is spending so much time inside with a computer, what's going to become of him? What is this weird thing? And then in the end it turned out all right, but it was for sure there was some intentional step towards having a career as a software developer and really more just of a passion.
Alex Booker (03:56):
Yeah, about pure magic and intrinsic motivation fiddling with computers and solving problems. It's kind of like if you enjoyed Lego or puzzles or something as a kid, once you can do it on a computer, it's like another level. But how did you even learn these things? There wasn't Stack Overflow or Scrimba or Smashing Magazine or YouTube or anything like that back then.
Matt Biilmann (04:18):
No, no, there wasn't internet, it was just when the world wide web started being invented and so on. Early on there was nothing like that. The computer was not connected, it was just your computer. I would loan books from the library about programming. There would be paper magazines with programs in them that you could type into your Commodore 64 and then it would run a game if you type them right, and if you didn't type them, you would've to figure out debugging, why is it not working? Where did I make a mistake?
So it was a very different world. Early on you started having disks with shareware on them that you could go get from the library and try and some of those had the source code and you could look at it and so on. It was a very different learning process. Until then, the worldwide web started coming along and you could start actually finding early tutorials online. I remember spending a lot of time just on the websites of PHP, .net and MySQL website in the tutorials there on how to build database driven websites. So all of those kind of resources was kind of just where you would go to learn and then [inaudible 00:05:30] and so a different world
Alex Booker (05:31):
When you were a bit older, did you get the option at least to study something like computer science at university and what did you decide to do
Matt Biilmann (05:40):
I had the option, but I actually didn't pursue that. I took a bachelor in musicology and comparative literature and then started on a master's in cultural studies while working as a freelance musical journalist. I always kept programming as my main form of procrastination and hobby and a passionate, I was always building stuff and building stuff online sometimes in relation to what I was doing at my study or work and so on. I still didn't imagine at that point that I would make programming and development a career in any way.
Alex Booker (06:10):
Was it a toss up in your mind between those two subjects?
Matt Biilmann (06:14):
Of course. I was very in doubt of what I wanted to study after high school, and I just think that at the time I felt it was more interesting to understand how humans work and how we understand the world than working towards a career as a software developer, which was still a new field at the time, and a lot of those roles seemed to maybe not be as interesting. So I ended up really taking that foray into the humanities and going in that direction, but just always had this passion for building stuff and kept that since, especially as the web really came around and became a thing, that magic of as a single person being able to just sit and type something and then put it up on a URL and suddenly it's available all over the world to anyone that can find it.
I kept being fascinated with that and then as chance would have it, met a girl from Spain, went and visited her there bit, she visited me and Denmark a bit, went to Spain a bit more and decided that I would go to Spain for three months and finish up my master's thesis from there and came there and realized, okay, I'm going to stick around for more than three months.
And also realized that the market for writing about music in Danish in Madrid was not great to say the least. So I kind of had to come up with a plan B at that time. And as I said, I had this passion for building stuff and was constantly playing around with ideas of what could I just build online? So I started just building a couple of different things. One of the first things I launched was is this online Sudoku challenge right at the time where Sudoku became a bit of a fad, but just with this concept that you could go to a website, you would get a Sudoku, you would solve it and get the time it took you to solve it, and then you would get the option to type in an email of a friend and they would then get the exact same Sudoku and get timed then both would be told who did it faster and so on.
Alex Booker (08:11):
It sounds like the original Wordle literally the same thing.
Matt Biilmann (08:15):
Kind of a similar concept, and actually I got that fascination really at that time that there would be this whole idea of these browser-based games that people could actually spend quite a bit of time engaging with, but in a much more lightweight manner than how you would engage with full on video games and so on, often in a manner that's more compatible doing it in small breaks while you're at work and so on. So the next thing I started building was this browser-based space game with a procedurally generated galaxy.
I found an old astronomical paper on the web from the '70s around stellar system formation by accretion, the theory of how planets form from a gas cloud around the star, and it had a whole algorithm for simulating that meant to be run on super computers back in the '70s, and I found out that computers were fast enough that you could easily run that whole algorithm during a web request on a server, so I could use that to generate realistic stellar system and then present them in a little flash viewer and have people be able to travel in their little spaceship from planet to planet and so on.
And I was starting to work on this whole thing, but then got noticed by Denver based startup was right around the time where Facebook was starting to move from being a project that were only available within certain universities and opening up to the public and MySpace was a big thing and so on, and everybody was sort of starting to get interested in building social networks and jumping into that space. And this was a [inaudible 00:09:52] based startup trying to build a social network and I got hired there. Working on that remotely from Madrid became my first actual job as a developer, and then that led me to get a job in Madrid working for a startup there and somehow went through a fast career journey there for a few years going from software developer to tech lead to director of technology and eventually CTO of the company.
Alex Booker (10:17):
It's fascinating to hear you recount your story because when you're a new developer, you have this temptation often I think to architect this perfect plan, you sit down with a blank document, you think about your timeline, your milestones, what you want to achieve, but it very much sounds like you just really love coding and you had to go on your own path and make the most of it.
Matt Biilmann (10:39):
Yeah, I literally just couldn't stop, and it's funny, I had these periods where while I was studying, I remember having an exam in comparative literature and I had to hand in a paper on [inaudible 00:10:51] and Modern American literature, and I was feeling so guilty because I was sitting and building this database driven website for an online game together with someone.
I had made an IRC just for free and I felt, oh, I'm really wasting my time sitting and building this instead of writing about [inaudible 00:11:09], I'm going to be late with my paper. So for me, it was really more at the level that I couldn't really stop. I just really got fascinated by all the elements of it from the puzzle solving to just this core sense of being able to build stuff that people can interact with all over the world just from your computer. It really did feel pretty magical to me the whole way through. And I remember when I first started working, when I first sat at Madrid and had my first sort of on location for Madrid standards well paid developer job, I kept having this feeling of when are they going to figure out that I'm just sitting here having fun?
Alex Booker (11:44):
Ha, you're kidding.
Matt Biilmann (11:50):
Jan Arsenovic (11:50):
Coming up, how Netlify grew from a tiny startup into what it is today and what were they looking for in the developers they hired?
Matt Biilmann (11:56):
When we were in the early stage and we hired our first junior, I remember sitting down and telling her, look, I am warning you. This is early stage.
Alex Booker (12:04):
I will be right back with Matt in just a second. But first, Jan, the producer and I have a quick favor to ask from you.
Jan Arsenovic (12:11):
Hi, word of mouth is the best way to support us and it's also a great way to get a shout-out on the show. So tell us what you think. I have a review in front of me that I'm actually feeling really humbled to read. It says "I'm working to change careers into tech. It's a long and difficult process that at times seems too daunting to accomplish. This podcast has helped me so much to have the motivation to keep going. When I hear all the different stories of new hires and their journey into tech, it proves to me that I can do this too. When Alex interviews industry experts, the knowledge they share is inspirational. It helps me shape my own plan and strategy to get that first role. Altogether, this podcast is a positive and pleasant listen that provides so much value. I look forward to each new episode."
This was written by a Seth329 from the United States as a review on Apple Podcasts. Seth, thank you so much. On behalf of Alex and me, best of luck on your coding journey and who knows, maybe one day we will interview you on the Scrimba podcast. Let's take a look on Twitter @ [inaudible 00:13:17] says "Your weekly podcasts are truth. They tell it like it is in tech for both junior starters and those that have more tech experience. There is no BS or sugarcoating." Thank you. And Sam, @ [inaudible 00:13:29], I believe L-E-G-G-E shared one of our recent student interviews and said, "I've listened to this episode of the Screamer podcast several times this week. It's not only motivating, but I can relate to so much of what Sylvia has experienced and said about learning coding."
Silvia Favello (13:44):
The moment I started, okay, this is going to be a career, I already felt like I was behind and that kind of made me overwork myself and almost hit a burnout, but I kind of backpedaled myself and was like, Hey, don't forget there's other aspects to yourself beyond this.
Jan Arsenovic (13:59):
I'm going to link it in the shoutouts and if you have any kind of feedback for us, you can either tweet about it or leave us a review wherever you listen to podcasts, so be it on Apple Podcasts or on Spotify or somewhere else. If your podcast app of choice has an option to rate or review a podcast, please rate or review us. Maybe next week I will read a review or a tweet that you wrote, and now we're back to the interview with Matt Biilmann of Netlify.
Alex Booker (14:28):
We know that today you are the co-founder and CEO of Netlify, and I'm really excited actually to learn a bit more about the inception story behind Netlify and what that means for developers, but I think the gap in the story here we need to fill in first is about you getting hired at this tech company and being promoted in rapid time. You were very much an employee, it sounds like, even though you're being trusted, of course, with all this responsibility. Where did this leap come from being an employee essentially to being an entrepreneur? Again, was that something like inside of you that had always been there or was it really the case that you saw an opportunity and you had the skills to take advantage of it?
Matt Biilmann (15:06):
It was a mixture. I always had that instinct, what if I just built something? Before I ended up getting my first developer job, that was sort of my first instinct. Why don't you just build something online and try to figure out some way of monetizing and build around it? Then as I worked in this Spanish startup, I built a close relationship with Julio, the founder, and as it happened, we had a bunch of different stuff we were doing, but the core business was building websites for small to medium businesses in Spain and Europe at a very large scale, so we would build something like a hundred websites a week. We had in-house sales team, project management team, support team. We had a whole network of freelance designers that would do the actual design work and then a fairly large engineering organization that I ended up leading that built the whole platform, that the designers would do design with, that the clients would use for content management, and that powered every single website from initial brief and all the way to production hosting.
And then I actually ended up starting my first company together with Julio is the founder of that company where we were basically talking through that we had built several iterations of this kind of web platform in-house for our own use, and we wanted to build a self-standing multi-tenant, cloud-based CMS that other professionals could use to build websites for their clients with a lot of the same efficiencies that we have built. I started that in Madrid as a CTO and co-founder, and Julio was the one that convinced me that we needed to do it from the Bay Area, that we should go to San Francisco and move the business here. We spent a long time getting visas and getting over there, kept working on the product, got a customer base but not the obvious runaway product market fit, and at the same time between Julio and me, we kept trying to figure out where did we really want to take the product.
And back in Spain, [inaudible 00:17:06] had started this community of designers and creatives with the thought that we needed that network of freelance designers as part of the business, and that community in itself kept growing and growing and at a point he really felt like he had to jump in and do something for real with it and turn that into a business. At that point, I took the CEO role and started running the startup and then started getting a sense this was a cloud hosted CMS in the traditional sort of way that websites and web apps were built at the time and that a lot of websites and web apps are still built, where each website, it's one monolithic application.
There was some separation between templates and content, but it was still one monolithic applications running on server with the databases, and I started getting that sense that the architecture of the web would change away from that and we would start splitting up the actual web UI layer into its own self-standing application, and this traditional backend would split into different APIs and services where some of them companies would build themselves, but a lot of them would be built by companies like Contentful or Stripe or Twilio or Algolia and the like.
And that's when I really saw a big opportunity in building the platform for running that web UI layer and for developing that web UI layer. So I built a small MVP in that space called Bit Balloon just focusing on the smallest step I could take in the direction of that kind of platform. The first step was just bitballoon.com where you could come, you drag a folder with the front end of a website onto the website and it would instantly get published on a URL and you could share it with the world, going back to that original sense of magic, of being able to write something and instantly share with the whole world and then started adding API and CLI functionality and so on.
Started talking to one of my best friends back from Denmark just around this whole idea that the architecture of the web was going to change and that this way of building where you decouple the web UI from the backend was going to become really mainstream. And we started just really talking through everything it would take to make that mainstream and to make that more approachable for developers. And that became the sort of first roadmap for Netlify.
Alex Booker (19:26):
I guess back in early 2010s or whenever, it was quite common, for example, to have a PHP file and maybe you put your front end code and your backend code in the same file. In other words, everything is quite tightly coupled. But then I guess around late 2013, early 2014, a lot of big changes started happening in the web. E ES6 became more prevalent and front end web apps became more popular. You could do more processing in the clients. Things like Git were on the rise compared to things like FTP as well. And I think you touched on something really interesting, which is that all these developer services were on the rise as well. Probably at some point, if you asked a developer to implement something like email, they would start implementing their own SMTP code and that's a terrible idea actually.
Matt Biilmann (20:09):
Alex Booker (20:09):
If something like Twilio was around back then, they might have scoffed and said, oh, I can code that myself. I don't want to depend on another service. But actually the way we build web apps and especially the way companies and startups build web apps is oftentimes they would rather buy a solution than build it and they'll integrate Algolia for search, they'll use Contentful for their headless CMS and so on. But I guess, and I hope this is a good jumping off point for the rest of the Netlify story, Matt, I guess there was a gap in the tools necessary to really streamline this workflow.
Matt Biilmann (20:38):
It was an early time where I think all of these trends were obviously happening. It was obviously happening. It was a real thing. APIs and services were obviously happening. They were a real thing. These modern front end frameworks, they were in their early stage, it was all sort of very open source and so on, but they were obviously happening and the movement was obviously happening. I think what meant a lot was that we saw all of these things not as different individual things happening, but as part of a broader concept. We came out with this term Jamstack to try to describe this idea of decoupling and of building self-standing web UIs, talking to a lot of different APIs and services.
Alex Booker (21:22):
What does Jamstack stand for real quick?
Matt Biilmann (21:24):
And I think Jamstack just really fundamentally described the separation of concerns between really decoupling the front end web layer into its own thing and separating it from all the different back ends you're talking to, and that allowed developers to really focus on, okay, what does it take to build a a great UI and what does the tool chain around look like?
It allowed new frameworks early on Gatsby and later [inaudible 00:22:37] and now [inaudible 00:22:39] and Solid and Astro, and so many others like [inaudible 00:22:43] and so on. It allowed those to really have that target audience of developers that are just building the web UI without having to navigate what kind of programming language and tool set and stack do the backend developers that are building the business logic and the data access and so on want to work in. That's what allowed a lot of us to suddenly build a new generation of tools centered around the web developer.
Alex Booker (23:11):
In a way, it is probably a bit hard for someone who hasn't experienced this shift to understand because if you've been learning to code in the last few years, this is probably just how web apps are built, right?
Matt Biilmann (23:21):
Yeah, it's true. The change has really been that fundamental. Today I think people are just like, but isn't that just how you build with [inaudible 00:23:29], but it's not that long ago that it really wasn't.
Alex Booker (23:32):
How much code did you write to Netlify today?
Matt Biilmann (23:34):
Today it's rare that I write code.
Alex Booker (23:37):
Fair, fair. I can totally understand that
Matt Biilmann (23:39):
Today it will typically never be code that's in the production path or something. I will write code on the side to keep myself up to date and to keep understanding things. I've been playing around with activity protocol and the stuff that's happening in this idea of a [inaudible 00:23:56] around [inaudible 00:23:58] or different tools like [inaudible 00:24:00] and so on to keep myself educated and just because as I said, I can't stop anyway. I've always been doing this.
Alex Booker (24:09):
That's a compulsion.
Matt Biilmann (24:09):
A compulsion, but in the day-to-day work, my work is really a leadership role of setting our strategy and making sure the company is going in the right direction and not a developer role in day-to-day anymore.
Alex Booker (24:21):
But in the early days there, was it just you at that time or did you have some help?
Matt Biilmann (24:25):
So in the very early days when we started, I wrote everything. When [inaudible 00:24:29] full stack, I wrote everything across the stack. I built our content delivery network, wrote the C++ plugins to Apache traffic server that did the TLS termination, and [inaudible 00:24:41] loaded the certificates. I built all the infrastructure automation. I build our CI/CD service, I build our origin server, our core API that drives the logic, and I built the web UI that people interact with.
Alex Booker (25:45):
When you were in the position to hire developers on the team at an earlier stage startup, what were some of the attributes you were looking for from these developers? What made these candidates stand out?
Matt Biilmann (25:58):
In the really early days, [inaudible 00:26:02] and so on. It was different things, but for the core development team, I was looking for a lot of experience because you need everyone to just be able to jump in and work very independently when you're such a small team. There's a lot of opportunity to learn, but there's not a lot of time to learn the basics. I looked for really experienced developers that were fairly generalists that could move around the stack, ideally developers that were very customer-centric and outward looking, so developers that really cared about what we were building and how it benefited our users and our customers rather than developers that were more specialized in their part of the stack and sort of more cut off from thinking about the [inaudible 00:26:47] of what they're building. So that was the core first developers we went for.
Then the first sort of more early career developers we hired were typically a little more closer to also developer relations roles where I found a good pattern of hiring people that were very good at teaching other developers about stuff that they were learning and it's a fun gap. Personally, I tend to feel like I need to know a lot about a subject before I can really teach others about it, but there's some people that are really good at writing about things they are learning themselves and sharing that experience of learning it. I think it's a useful skill and the people we hired in general based on that skill that were early in their career all have had pretty amazing careers since we hired them, so it was probably a good indicator, but for us it became an easy way of both having them work on some of our systems but also tell the world of developers around us how they were learning to work with this stack and this technology and be at the sort of same stage in that journey as the developer they were educating.
Alex Booker (27:57):
I really appreciate you recollecting on what was going on at the time in the early stages of the company because I think for anybody listening, applying for jobs, you never really know, not always, what's happening on the other side of the table, what they're looking for specifically, what their strategy is and why. And I think the way you lay it out as an early stage startup, there wasn't really that much opportunity for handholding even though maybe you would've liked to, it was much more important that the engineers can work independently and this is an infrastructure product at the time, and I would say the code is pretty pivotal to the success of the business. That might not be the best learning environment necessarily. And the other big takeaway I think from what you said is that if you were presented with two brilliant engineers, maybe they were equally scaled in terms of their raw coding output.
There are always differentiators. It could be something like soft skills and I'm sure that played into it. People want to work on difficult problems, not work with difficult people, but then there's also an element of product intuition. In an early stage startup, you might not have the bandwidth necessarily to keep people informed about the customer and keep educating them about the problem and the news and the industry and things like that, but if the developer gets it, they know the solution they're here to solve and they have some empathy for the customer, I bet that's just a force multiplier really in a small team. But as you describe it, as the company grew and evolved, of course there are more opportunities to work with less experienced folks and they really love the idea by the way, to get started in developer advocacy if you're the kind of person who likes teaching what you're learning.
Matt Biilmann (29:26):
And I think in general for companies in the earliest stages, if you build and share stuff online that are valuable to other people, the ability to do that in itself is a skillset that's almost certainly going to be useful in an early stage startup employee, so that will for sure help in those kind of roles, but those are also very different from if you're listening to this and you're starting out as a developer, theres very, very different developer roles and developer journeys. Any kind of early stage startup journey is going to be requiring you to be extremely self-motivated and self-driven and very comfortable in learning on your own. When we were in early stage and we hired our first junior developer as an experiment, I remember sitting down and telling her, look, I am warning you, this is early stage. We don't have any systems for training developers, we don't have any processes around it.
It's pretty much going to be like, here's your laptop, good luck. And I think that's the reality of early stage. Then the later the stage a company, the more there will be a [peer 00:30:35] path for intra [inaudible 00:30:37] developers. Now at Netlify we'll have things like a cohort program where we will bring a group of entry-level developers in to work on our foundations team, help out across different part of the stack with very senior and experienced developers around them and with more guidance and help and with a much more controlled path to growing into the role. And the later stage the company you join, the more of that they will have. So the more you want a path that's paved and that's laid out for you, the more you should aim for larger and later state company and the more you feel you thrive in the more chaotic environment where you just get thrown one challenge after the other at you and you have to figure them out. That's more the earlier stage company situation.
Jan Arsenovic (31:26):
Coming up, why we still need junior developers and what's the state of the job market going to be like after the layoffs?
Matt Biilmann (31:33):
Almost every company is becoming a tech company in some form.
Jan Arsenovic (31:37):
Hello again, and sorry for the interruption. I'll be brief. I just want to ask you to subscribe to the show if you made it this far and if you've learned something, you can find the show wherever you get your podcasts and there's a new episode every Tuesday so that way you can make sure you are not going to miss any of the upcoming interviews. But in the meantime, we have already published more than a hundred episodes, so if you're just discovering the Scrimba podcast, there's a lot of great info in our back catalog. One week on the podcast we talked to an industry expert and then the following week we talk to a recently hired new developer so you get to learn from both sides, and now we're back to the interview with Matt Biillmann, the CEO of Netlify.
Alex Booker (32:19):
Why do you think companies hire junior developers, especially in recent years? Maybe you'll tell me I'm wrong about this and I'd really welcome that by the way, I'll just tell you my assumptions. I feel like especially in the last few years with cheap interest rates and the thriving tech companies, they can hire more experienced developers if they want to.
Now that has changed a bit I think in recent months, especially until recently, if companies can hire a more intermediate developer who can hit the ground running maybe and generate more business value potentially in the short term, they're going to do that I would have thought. At the same time, I know that's not the whole picture because even in recent years I've seen junior developers getting hired left, right, and center. There are all kinds of opportunities out there. Hopefully I can phrase the question as why are junior developers kind of awesome? What is their appeal to companies?
Matt Biilmann (33:07):
I think there's many answers to it and I think there's also many different kinds of entry-level developers. You could have one entry-level developer that's really early in their journey and have a lot to go to learn, how to work with web software. They just have a lot of experience they need to learn and so on. You can have another entry-level developer that's maybe out of a computer science department, is brilliant in deep algorithms and so on, but has never worked in a company and the reason for hiring those two will typically be different. One might be you hire someone new to work on really deep complex problems, but you know they need a lot of support around them to actually figure out how to do that in context of a company and the other might more be like that as a company grow more and you become a larger engineering organization, there's always a lot of different jobs to be done and a lot of those things for a very senior, very experienced engineer will be something that for them represent almost no growth.
Stuff that they've done many times before, they know how to do it and if they end up spending all their time doing stuff that don't really grow them at all as developers, that will either end up affect their morale or they'll look for somewhere else to go with problems that are more interesting for them or they'll just stagnate as developer, they'll stop growing, which is also bad for your company over time.
As your company gets larger, it starts being really healthy to have a mix of more entry-level people that with some guidance from those senior developers, can go and do a lot of the work that still represents growth for them. It's stuff that they can actually learn and that will grow their career and that will move them forward and so on, and that really needs to be done for the business. It's not unimportant stuff, it's [inaudible 00:34:57] stuff that totally needs to be done as part of building new product, as part of maintaining existing product and so on, but it's just not the best place to apply a really senior engineer in terms of also growing that person and solving [inaudible 00:35:12] problems.
So I think as I said, I think in the earlier stages of a startup, you want everyone to be very self-sufficient and experienced enough to really own the outcome for their part of the code base, but then longer term, as you build a ladder engineering organization, then it's not actually healthy if it's too top-heavy in only very experienced engineers because you want that balance of also being able to give problems that are not exciting to a senior engineer, but they can be really exciting to someone early stage because it's a real learning opportunity. You want to have that dynamic of people that come in and learn and grow and freeze up some of the more senior engineers to tackle their harder problem.
Alex Booker (35:56):
I think that is a fantastic answer. All the best developers are the best developers because they value growth and by definition, if they're at a company and not being challenged, they're not going to grow. They might go somewhere else. A junior developer will look at the same task that a senior might see to be a chore. A junior might look at that and see it as a great opportunity to sink their teeth into it and of course the senior can help them a little bit, steer them in the right direction. It sounds like an incredibly productive scenario.
Matt Biilmann (36:22):
Once you have people grow into staff role and principal roles, one of the things you're really expecting from developers at that level of their career is also that they know how to work with the rest of their team and be a force multiplier. You expect them to go in and help developers be better with them than on their own. If you give the senior developers opportunities to start building that dynamic and start learning how to also help other developers grow at that stage, then they will also be stronger when they grow into being staff level or principal level developers. Over time, as you build the engineering, all these kind of dynamics are really healthy.
Alex Booker (37:03):
Do you think that junior developers are a good investment?
Matt Biilmann (37:07):
Absolutely. Absolutely. I think it's great to have people that grow and learn through your company, whether they grow all the way and stick in the company or whether at some point they want to experience a different place. It's a great part of the energy of the company that people come in and learn and grow. It's an important piece of the culture of the company and celebrating that is an important part of the engineering culture at a good company. I think that's very valuable. And then of course there's an economic part of it where the more you can free up your most expensive developers to solve problems that only they can solve and have more entry level developers build things that are at a level that they can build them well, the math adds up.
Alex Booker (37:49):
I was hoping we could extend that discussion around the economic factor to some news that's been circling lately in tech around large companies especially. We're talking about the Facebook's and the Amazon's and the Google's of the tech industry doing absolutely massive layoffs. We're talking tens of thousands of people in total. I know that when junior developers see this, it is a pretty shocking bit of news because if you're looking to enter this job market and now you know all these talented engineers are entering the talent pool, that implies things are going to get more competitive essentially. Can you teach us a little bit? What's happening here, Matt? Why are these layoffs happening?
Matt Biilmann (38:29):
Yeah, it's hard for everybody affected and it's affecting the whole tech industry. In the last couple of years we were in a very unique environment in the sense that interest rates were basically zero. That meant that if your pension fund with a lot of money or if you for whatever reason not holding onto a lot of cash, that cash, unless you take some risk and put it to work in a risky sector, that cash is basically just losing money over time compared to inflation and so on when there's no interest rates.
So that meant that in that environment, cash would flow into any kind of area that would have risk but could potentially give a real return of investment, and the tech sector represented a lot of growth potential and still does. Technology is really a key part of driving the world forward. Technology development is no less of a growth opportunity than it was a year ago, but the low interest rate means that as long as there was growth, you would know as a business that you would have access to more capital to accelerate that growth and it created a competitive environment where if you as a business didn't invest very heavily into growth, then your competitors would do it and you would risk being outgrown or out developed by your competitors.
So there was this intense sense of everybody had to take capital and invest it very heavily into accelerating growth and growing faster than they could just based on more sort of business fundamentals of reinvesting their profits and so on.
Alex Booker (40:04):
When you say take capital, are you describing rounds of funding including things like loans as well?
Matt Biilmann (40:10):
Both rounds of funding but also debt. In the private sector, private growth stage company and so on, it would typically be rounds of capital. In public companies, it would typically be debt. Again, if you can get access to loans at a very low interest rate and then you can use those loans to make your business grow faster, then you're kind of almost obligated to do that because otherwise your competitor will do it and grow faster than you.
So it creates this very overheated environment. Now that interest rates have increased dramatically, suddenly there's like this big correction happening where if a company keeps pouring that amount of money into growth, they are not going to get a refinancing at the same terms when that chunk of money runs out. So across the industry, all of these companies kind of have to adjust to this new reality and get the money they spend on growth in line with what they can actually sustain over time, and that's why a lot of the questions will be like, wait, these big public tech companies like Google and Microsoft, they have plenty of profits, so why are they cutting back?
They're not out of money, but it's the ratio that they're thinking about. How much of that are they putting into forcing growth, that with a change in interest rate suddenly becomes out of whack and you get this kind of big market adjustment and it's really hard for everybody that's involved in the wrong side of suddenly going through layoffs and so on.
What I would say to developers is that developers even in the tech sector are less affected than people in sales or recruiting or challenge and admin and so on. [inaudible 00:41:54] at the softer part of this equation, if you are in a developer role and in general across all the sectors, if you don't just look at the tech sector, no one ever feels like, oh, we have plenty of developers to do everything we need to get done. Everybody always feels that they have more stuff to do than they can do with the developers they have. So I think part of this we'll see a little bit of evening the playing fields for the non-tech companies in hiring developers and some of the development roles will flow from very big tech companies that could just out pay because of their growth potential more traditional businesses and I think we'll see.
Alex Booker (42:36):
Actually, can we talk about that for a second because I know in the last year and a half, two years, especially developer salaries have gone through the roof. It's remarkable what we've seen in the last couple of years, and as much as all this news is quite shocking and upsetting for a lot of developers.
I think it is in some respects, a bit of a course correction. It was a bit of a bubble and those good times were not going to last forever. Even now, things have settled a bit, you're still settling at a level which is very, very good in the grand scheme of things. And just ever so quickly, I liked your point a lot as well that among those thousands of people being laid off, many of them will be in sort of admin and recruiting roles. Obviously if you're scaling back, you don't need as many recruiters to hire as aggressively, but I'm hoping we can just tie it all together. What happened this last year or two? Why were developer salaries going up so much and what does that mean going forward do you think?
Matt Biilmann (43:25):
This massive amount of capital flowing into the tech sector also meant that the demand for developers really surged and the market for hiring developers became incredibly competitive. I do think, as you said, that it was somewhat of a bubble and we are seeing a correction, but as I said, there's still a fundamental need for developers. Digital technology is still only becoming a larger part of our world. It's not becoming a smaller part of our world, and that also means that the other part of this that we've seen that's a little less dependent on just the search and tech companies and so on is sort of this tendency. Almost every company is becoming a tech company in some form, and almost every company now needs some developers and staff, and that part of the evolution of our world in our industry is not tied to sort of the bubble we saw burst in the market correction. We've seen that is still like long-term and more fundamental change.
Alex Booker (44:28):
I think it was in 2011, [inaudible 00:44:31] famously wrote that software is eating the world. It is, and it is not full yet. There's more innovation happening and I think you make a great point as well, that if these very successful companies, the Google's and so on, could afford in this market, they have the money to pay these crazy salaries, that was quite difficult for smaller companies. If they couldn't have matched for salaries then they might struggle to get the talent they need to get the job done.
It might not be that there are less jobs. Maybe the jobs have been distributed more across a different range of companies from startups to SMBs to enterprise companies. Only time will say for sure, I think.
Matt Biilmann (45:05):
Alex Booker (45:05):
Matt, thank you so much for spending an hour with us. We've learned so much. Fascinating to learn about the inception of Netlify, your experience learning to code, and I think this is a really important conversation as well around the reality of the job market and what's happening, and I really appreciate your candor. Thanks again.
Matt Biilmann (45:22):
Thank you so much.
Jan Arsenovic (45:24):
That was the Scrimba podcast, episode 102. Thanks for listening. Make sure to subscribe and if you're tweeting about the show, please mention Alex. You can find his Twitter handle in the show notes. I'm [inaudible 00:45:37] Jan the producer and we'll be back with you next Tuesday.