‘SSUP!’s team 53°N interviewed CEO and co-founder Christian Strobl, and Head of Demand Roman Rittmann of Hackerbay, a software and services company from Berlin
We got an hour with Christian and Roman, both self-taught hackers with backgrounds in law and communication respectively, about starting up a tech services company in a tech booming era. Hackerbay has changed direction quite drastically in its short ~2 years existence, from services to consultancy and to software development. “There has been some misunderstanding of what Hackerbay is in the media. Essentially, we are a Software and services company with a focus on manufacturing technology and AI,” Christian explained. Now, Hackerbay has found the right product-market fit and is scaling up fast.
As a source of good?
“If you do this for the sake of becoming rich, becoming your own boss or for fame, you are just stupid… do it because you want to make a change to the world and the rest will come.” After his time in PE, Christian didn’t think of starting a company himself straight away: “PE became boring, so I left, and I taught myself how to code through attending several hackathons. In Hongkong we accidentally ran into Bitcoins. This sounded very strange to us, but we invested anyway and made some money. Then we decided to start mining ourselves, while attending more hackathons. All of this was just super exciting… we just rolled into it and became part of the hacker community.” And within this community Hackerbay was born. Today, the vast majority of the team consists of (former) hackers.
Finding the niche with highest chance of success
Quickly they got traction and signed projects with well-known companies like Skype, Twitter and many large automotive players. “Since the end of 2017 we know what our winning value proposition is and we are now moving into the hyper-scaling mode,” Christian told us. That value proposition is around simplifying network structures and digitizing processes, primarily within manufacturing environments, saving hundreds of millions in costs and productivity gains for their clients. “In manufacturing we see most value now, where there is less regulation and we encounter the highest pain points for our clients.”
Working together closely with the C-suites of their clients, they build large business models in no-time. This is also where their USP lies: execution driven mindset and unprecedented speed. They deliver a 10 year vision, 2 year tech roadmap and first cost savings within no more than 3 months. “Our trick is to build easy-to-understand and user centric software to decrease friction within operational processes. Don’t give too many options to the people that need to use it, make it intuitive. We need to be the owner of the product (not the client), so we can move fast. Of course, we develop it together with the client,” Christian explained. To be able to compete on speed, Hackerbay does not build everything in-house (“that is not what we are paid for”), but uses Amazon web-services where possible. As an outcome, Hackerbay’s solutions deliver real time information on the shop-floor, which their clients can use for improved decision making.
Finding the sweet spot without much competition
“At the moment we announced that we became a consultancy, our own people left and went to for instance McKinsey. Now we are so good at it, that we decided to become a software company.” Hackerbay’s founding team realized that consultancy alone will not be enough; software is necessary to scale up fast and, next to speed, gives them a competitive advantage. As they tell us, “In that sense I do believe that we are in a new market, which is not yet captured by others. Companies like Accenture and IBM are more interested in large and complex IT projects, where they can write a lot of consultant hours. We focus on other type of projects and since nobody else is so aggressive as we are, we are able to win these projects.” Customer acquisition so far is mainly done through word of mouth… as always, reputation travels fast.
Now that they have found a sizable niche (500bn revenue market and ever growing) and achieved product-market fit, it is time to scale up rapidly. “You want to hear the numbers? This month we still want to hire 5 new employees. We are now focusing on in-sourcing instead of creating a network. The target is to reach 120 employees at the end of 2019.” In that perspective, Berlin is great for hiring, where there is a lot of international talent (also from the US). Hackerbay recruits solely from their own network: “we have been in the community for a while and this world is very small. Also, the first 40-50 people are absolutely key. Everybody employee has a vote; if you don’t like a potential new-hire, that person is not accepted.”
How to get from 0 to 1 EURmn revenues in one year?
Since we find this achievement quite impressive, we asked them about the how. Here is Hackerbay’s recipe:
- No ego – it is okay being laughed at and you just have to try
- High iterations – iterate your language over and over again until it sticks
- Great team – Christian and Roman work hard (“100 hours easily”) and you can’t do it alone
- Setting the right price – pick one key differentiator (in Hackerbay’s case this is speed) in the market and adjust your price to it
- Be honest – for instance, never make the figures look better than they are
- 8 out of 10 decisions should be right – and once a year you need a 100x decision (e.g. funding from Silicon Valley against the odds, or the extremely helpful roadmap one their new team members created)
With all this experience you would expect Christian to use this in the future for new start-up projects. However, “I’m not going to do it again. We are now getting at the tipping point of not being naïve anymore. At a certain age it gets harder to put the effort in it,” he told us at the end. Who knows! If not, then at least we hope that Hackerbay becomes the next big revelation within the software and services industry.
And finally, our two wacky questions…
…If Hackerbay was an animal, what would it be? “A Fox. The always find ways in, they are smart and sneaky”
…And if you can hire anyone in the world for Hackerbay who would it be? “Travis Kalanick, former CEO of Uber. He is the best executor in the world and he could help us to scale up the company”