As we gear up to celebrate the 50 top innovators in the D.C. metro area, DC Inno is taking some time to sit down with a handful of our 50 on Fire winners to see what exactly makes them “on fire” in our DC Innovators series. Join us Nov. 1 at the National Union Building for the celebration.
Matt Calkins and the team at Appian don’t have the same old tech startup story. They didn’t start Appian and then immediately chase after venture funding. They haven’t been focused on high-speed growth.
When the team set out to build Appian almost 20 years ago, they were bootstrapped and slow-and-steady was the name of the game. Now, Reston, Va.-based Appian is not only the sole D.C. tech IPO of 2017, but it’s also the most successful initial public offerings that debuted on the stock market this year.
Appian designs a platform that allows other companies to customize and create their own software programs. Founded in 1999, Appian debuted on the NASDAQ on May 25 at $12 per share. On Tuesday, Appian’s closing stock price was at about $23 per share.
Calkins, Appian’s co-founder and CEO, admits the company’s strategies and leadership strategies haven’t changed much since they went public. If anything, they’ve doubled down in their strategies. That’s what got them here.
DC Inno caught up with Calkins to chat about the aftermath of Appian’s public debut in May, how the D.C. region bolstered the company and what’s next.
Tell me about how Appian came to start.
It was started with an idea that evolved. We initially wished to write software, and we ended up being a platform that helps you write software.
There have been a number of twists along the way, which I can get into, if you’re interested, but it was not a smooth path, and we’ve been through two major recessions. We did it with a minimum of outside funding, just $10 million, and we got that nine years after we started the firm. We’re almost a boot-strapped, and as such, we had to be resilient and opportunistic.
What are some of the things in the past nearly 20 years that have come out of building the company that were unexpected?
When I started out, I did not expect to be here so long and I think those things made it possible, considering how much I love change. In this organization, we see so much change — the landscape, the tools at our disposal, the business plans. It’s been a journey of invention, and we keep inventing not just new ideas and new markets, but even ourselves.
The reinvention of Appian has kept this interesting, and I think that’s part of the reason why all four of the founders of the company are still here and working together.
“What strikes me most is how little we’ve changed.”
How has Appian grown and change in the last nearly 20 years?
There are some obvious ways that we’ve grown and changed. We started out with no revenue, and now we have $100 million. We started out with four employees, we have more than 800. We started out in an apartment, and then when we got through the apartment, we had to buy a house so we had a basement to put the company in. Now, we’re in a much bigger space.
I don’t think that’s what you’re looking for. I think you’re looking for bigger things, and my answer is going to be we’ve changed so much less than it seems. These metrics make it seem like it’s a totally different firm, like we started as a seed and now we’re a tree, and I don’t think so.
Our values have been really consistent, we still look for the same sort of employee. We still succeed for the same reasons. We still make our decisions the same way. We had a model, and we figured the model out right at the beginning. It’s very customer-centric, very hands-on. Every idea got challenged. We prioritized working with great people. We’ve had these principles since right at the beginning, and, at every size that Appian has inhabited, that’s been us.
So, what strikes me most is how little we’ve changed.
With that, what was that moment like for you when you were on the NASDAQ floor and you hit the button to go public?
I hadn’t expected to enjoy it as much as I did. I don’t see it in any way as a finish line. It’s just part of a longer journey, but I enjoyed it every much as a moment to recognize what we’ve accomplished.
And it was great to have my kids there, and my father was there. My kids and I pressed the button together. My son and my daughter and I had our hands together on the button, and we pushed it together. My daughter, she told me later, it was really her who pushed it, but we pushed the button together, and that’s such a great moment. They’ll always remember it. They each have a framed photo of that moment in their bedroom. I’m really happy about that.
I was running around all day, and I hadn’t slept very much because, of course, the roadshow takes a lot of energy, and I was up until the wee hours of the morning. The day was just a serious of interviews. I still didn’t getting tired. Straight through it was a fantastic adrenaline-filled, rush of a day. It’s a great threshold to get across.
Approaching it, I didn’t think it would mean anything to me, when, in fact, it does mean something. I try not to look at the present. I try not to be satisfied with what we have or what we’ve done in the past. I’m still sticking with that. I think that’s the right way to build a company. Satisfaction is too dangerous, but I was able to be satisfied with that accomplishment.
What are some of the things in the D.C. tech ecosystem that has helped you all?
We’ve very D.C.-centric. We’re not by any stretch the first public company in the D.C. area, but we might be different from the others in just how D.C. we are. Let me explain.
We were started in the D.C. suburbs, and every address we’ve had has been in Northern Virginia, to be precise. All of our founders have been in the D.C. area the entire time, and still doing it. This has been our biggest headquarters throughout. Our board members are all based in the D.C. area. The funding we got was all based in D.C. We’re a top recruiter for local schools, we speak at local schools, we get involved in D.C.-centric programs.
We’ve shown what kind of company the D.C. region can create. We took the best of what this region has. This is a thoroughly Washington-originated organization, and it shows what Washington can do.
“This is a thoroughly Washington-originated organization, and it shows what Washington can do.”
Is there anything different at Appian now that you’ve IPO-ed?
We’ve had an advantage for a long time in that we have fewer moving parts than most organizations. I try to emphasize that, not just structurally, but managerially.
Every decision is delegated to a person. We don’t do committees here, we invest people with responsibility. I love having simple organizations. The IPO threatens to undermine that simplicity, and I’m holding onto it.
We’re spending a limited amount of time doing the investor circuit. I spend four days a quarter on it, and that’s pretty much it. The finance department will tell me where to go and who to talk to, but that’s what I’m going to spend. Most of the organization is carrying on as usual.
We don’t encourage people to check the stock price. All I ever say about it is that the stock price doesn’t matter, don’t pay attention. I don’t pay much attention. I think I checked it about once a week. It’s a dangerous distraction if you let it be.
What are some of the plans and goals you all have on the horizon for the next few years?
Our number one goal is to keep all of our strengthens as a larger scale. Appian is a winner right now. It’s got a great goal, great people, great end product and customer experience, and we’re growing. Growing can be a dilution, and we mean to maintain what we are in the face of growth.
Our product is a platform in which you can build a unique piece of software. We mean to cut the cost in half every two years, which means that if it took you 100 months of programmer time to build an application two years ago, you should be able to build that same application today for 50.
We’re going to keep driving our strength, and our strength is that we’re the most efficient way to build unique software in the world, and we’re going to get better at that. Every two years, cutting the cost in half. We’re serious about that, we measure that internally.
We think that if we cut down the cost of building software, then software will assume a different place in our lives. Software will become a different type of tool. A more handy tool to solve all kinds of problems. Today, we think of software like putting up a building. We only do it at great expense and great time and only if we’re really sure that a building belongs right there. Building software should not be like building a building. It should be something you do spontaneously, and you can change it over time.
I want software to be a vital component of real-time behavior, and I can do that if I keep bringing down the cost of making it.
Correction: A previous version of this article misstated the number of employees Appian has. The company currently has more than 800, not 100 employees.