3 Big Decisions that Shaped the Silverfort of Today with Hed Kovetz, CEO and Co-Founder

Andrew Monaghan [00:00:00]:

In this episode, I talk with Hed Kovetz, the CEO and Co-Founder of Identity Protection Company Silverfort. Silverfort has been growing really well over the last few years and attracting some great talent. For this interview, HED and I focus on three decisions that he and his co-founders made that shaped in a large way how Silverfort looks today. They were around the type of product they wanted to build, how they wanted to go to market, and what sort of company they would want to work at. And Hed goes through the decisions and the upsides and downsides of each of them. Don't go away. Welcome to the Cybersecurity Revenue Growth podcast, where we help cybersecurity companies grow sales faster. I'm your host, Andrew Monaghan.

Andrew Monaghan [00:00:51]:

Our guest today is Hed Kovetz CEO and Co-Founder at Silverford. Hed, welcome.

Hed Kovetz [00:00:57]:

Thank you. Great to be here. Thanks for having me.

Andrew Monaghan [00:01:00]:

So, Hed, the saying goes that it's in your moments of decision that your destiny is shaped. And no doubt there have been times in your life, in the life of Silverfort that a decision that you've made shapes big things that happened afterwards. Sometimes good and sometimes not so good. So unintended consequences sometimes. So today what we're going to do, is explore three of those decisions that you've made along the way. Why don't you take us back to the first one?

Hed Kovetz [00:01:26]:

Sure. So this really goes back to when we really started the company, or even before that, when we just had the idea of what we wanted to do, which in our case was around identity security. Now, we know that we want to build something in identity security because we know it's a big problem that is only getting bigger. We knew that something was not done right because there were so many attacks that were using stolen identities, but still we didn't know what the product will be, what are we going to build, or what would make it different or attractive.

Andrew Monaghan [00:02:01]:

So Hed, let me interrupt because I want to get into the detail of this. So when you say we, who's we?

Hed Kovetz [00:02:06]:

Me and my two co-founders, Jaron Kastner and Matan Fatal. We started this company together. We knew each other from before and we knew that we wanted to do something to start a company. We also knew that it should be an identity. We had an idea for a product, but it kept evolving, I think, naturally, right? I think most founders don't end up building exactly the product that they started with because they listen to the market and they adjust, hopefully. But we were at that ideation phase where we were trying to figure out what to do. And I think that there was a lot that I took for granted in our assumptions or the way we did it, that I understand only today that it wasn't that obvious.

Hed Kovetz [00:02:50]:

And maybe there are other potential ways to do it. For example, it was very clear to us that we want to build something very different, like completely rethink the way that identity security is done and do it in a much better way, and that involved inventing new technology and figuring out a whole new approach, which to us sounded obvious. Like, why would you want to be a me too? Why would you want to do something that five other companies are already doing? And I think that that was a point where, looking back, we didn't really understand the meaning of this decision. I'm not saying that I would necessarily have chosen differently. I think that obviously I'm happy with where things are going, but I think that there was something there that was obvious to us that we have to build something new and completely different than anything else. Now, after a few years of me speaking to so many other entrepreneurs and watching their journeys, and giving advice to some entrepreneurs who are only getting started, I understand now that it's really not an obvious decision and there are pros and cons to it. So if you go build something that is not completely unique, but it is in a very hot new category where there are only three, four players, and you're going to be the fifth one, and you execute well, and you may not be the only vendor doing that, but you'll be one of a few companies that will all be successful. Or the good ones, at least, will be successful.

Hed Kovetz [00:04:18]:

So it's not a condition to do something completely differently in order to succeed. If anything, I learned over time that some of these companies had quicker success. Maybe their long-term potential, maybe is not as big as what I believe. Ours is just building something completely revolutionary. But I also didn't fully understand the benefits of doing that, of going to something well defined, very hot, that people understand and there are a few companies to learn from and compete with. We went to invent a type of product, a category. Luckily for us, we were at least doing it to solve a known problem. We didn't educate anyone about the problem.

Hed Kovetz [00:04:56]:

I think that's always almost too difficult. We only needed to educate them about a new way of solving it. But that's still a longer path. And I think that we didn't fully acknowledge that the result of that ended up being us building this for a few years before we really started going to market effectively.

Andrew Monaghan [00:05:15]:

So I would imagine the three of you are there and you're naturally thinking the right way to do it is a different way, right?

Hed Kovetz [00:05:23]:

Yeah.

Andrew Monaghan [00:05:24]:

And then are you kind of answering the question, well, what about this and what about that? And realizing that there isn't something that does this, there isn't something that does that, and then you will need to build this and then we need to build that. It must be a long list of things that you're kind of realizing along the way, holy crap, we actually need to build all of this ourselves because there's not something we can go get from somewhere else.

Hed Kovetz [00:05:43]:

Yeah, and that was the exciting part for us building something completely different, overcoming all these barriers. We met some other companies that told us, hey, this is impossible. We tried to build it and it's impossible because of this and that we get more excited. I think that eventually, it paid off because we were able to cross those barriers and build something and I think is amazing. But that took a long time and it took a long time to get the first customers to understand it. It definitely took time to get investors to understand. And I think that it was so clear to me that this is the only way to do it. And I know now that it's not that there are other ways with other advantages, disadvantages that in many ways are quicker wins.

Hed Kovetz [00:06:26]:

I'm very happy now because I'm already like a lot of it is behind me. A lot of these existential questions of will it even work. Will people even understand it? Can I even raise money? It's behind me now. So it's easy to say, hey, that was a great decision, that was an obvious decision. But it wasn't like early on going back to that before we crossed all these barriers. I think I understand today that it was very not trivial.

Andrew Monaghan [00:06:49]:

And you mentioned their investors, I mean, investors oftentimes they're looking for the short route to revenue, right? In many ways they're looking for ways to make things quicker. Were you under a bit of pressure? Were they asking you questions about the length of time it was taking?

Hed Kovetz [00:07:07]:

Yeah, for sure. I mean, a lot of people raised their seed round without having anything to show, right? But we raised our a round with barely anything to show. Right. Our investors had to be pretty patient and believe in what we're building and believing in us as people, which I understand today is in the early stages, probably the most important thing for investors. But they really needed to believe that we're going to solve this problem and we're going to build that very different thing. Before there was a lot of poof, at least not from a go to market perspective, until relatively late. It also changed the mentality of us as leaders and us as a company where a lot of other companies around us, I mean think a few years back especially, they were just doing a lot of press and growing super fast and burning money and making a lot of noise. That was the mentality.

Hed Kovetz [00:07:58]:

And in that market, in that mentality, we were the opposite. We were under the radar, very responsible, growing very slowly, trying to really make sure we have product market fit. Now, you know what, looking back, it saved us. It saved us from mistakes that some companies have made in the 2021 market, but that wasn't intentional. It's one of these things that I can be thankful for today, that we were careful, we were responsible, but most of it was because of that mentality that stayed with us from the beginning, of the mentality of building something very different and knowing that this will take a long time.

Andrew Monaghan [00:08:33]:

I imagine, though, amongst the three of you, there must have been some moments where a year or two in you're looking to going, god, this is taking longer than we thought, or I knew it was going to be difficult, but this is more difficult than I thought. How did you approach it when those moments came up?

Hed Kovetz [00:08:47]:

Yeah, it's true. I think that one of the most important things for entrepreneurs in general is probably the ability to convince yourself that you are going to solve this, that you're going to overcome these challenges, because there's so many of them, and there are so many points in time where you feel like, this is not happening. This is not going where it should. And you have to pull yourself together and really convince yourself, really yourself first and your partners, that we are going to cost this, that it will happen. And then only then, you can really convince others if you really believe in that, because people can see if you don't truly believe in that. And I think that we did. We did truly believe in it. We truly believed from the beginning and I obviously believe in it even more today, that what we're building will change the market and it will be just a better way of doing identity security.

Hed Kovetz [00:09:35]:

But that was like such a big thing to argue and to believe in early on where there was no proof that, yes, it was a little, not a little. I feel like it's blacked out for me. But it was hard. It was difficult to handle those times when it didn't look like it was going anywhere necessarily, at least not as fast as it should. And those were challenging times. You really needed a lot of walking to just get yourself to keep going and believe that you will cross those challenges. The good news is that once you've done so, if you chose that long path, I tell entrepreneurs that are only getting started now, if you chose that longer road and you're going to build something very different, it's going to take a long time. The good news is, once you cross it, you have something truly great that is hard to compete with.

Hed Kovetz [00:10:25]:

It's something that is really, really special. But I think I would be lying if I will say that it was just the right choice. It was easy. It was definitely the right thing to do. Because now it's easy to say when I'm past a lot of that hard time. Early on, I was looking around and all these other CEOs that are friends of mine that are building something so quickly and selling their companies for hundreds of millions of dollars after two years or three years. And I was like, I'm not even in that direction now. As I fast forward a few years, I'm very happy with my choice because I cross those barriers and I have something amazing that is really going to be big.

Hed Kovetz [00:11:03]:

But that's an unfair way if I just present it as if this was necessarily a right decision because of how I feel now. Right? I know that it's not revealed that it even got to this point.

Andrew Monaghan [00:11:15]:

Do you think the nature of identity and the complexity of identity meant that you had to do something completely different, new, than in some submarkets? Maybe it just doesn't need that whole new approach.

Hed Kovetz [00:11:28]:

It's a great question and I remember early on thinking about what we're going to do and there were many reasons why I wanted to go into identity. Right. I think that, as I mentioned, obviously a lot of attacks are using stolen identities regardless of all the solutions that are out there. And I also always believe that if people will eventually walk from anywhere now this was before COVID but if they will eventually walk from anywhere and use any device, then network security will become less effective. Endpoint security will become less effective. And if people can really connect from anywhere using any device, then it's really their identity. That is your last line of defense. I believed in all of that.

Hed Kovetz [00:12:06]:

But as I analyzed the pros and cons, I think that when you really want to compare honestly the different categories, you see that there are either categories where this is the case. It's a big existing category where you can really, really get a lot of become a big player if you do it right. The challenge is usually it's too crowded, there are so many players already, so many solutions already, and building something new is almost unlikely in those big categories. And then there are small categories that are only now emerging where you can probably build something innovative, easier, but it's not a huge market yet, not necessarily huge a budget yet. You need to create something as a category. We took the decision to go for a very well-established category and try to disrupt it, try to do it in a very different way, which I think is a very difficult challenge. Again, looking back, I don't think I fully understood it back then. But the good news is if you can actually cross that, if you can actually do something truly innovative in that category that is a real better way of doing things, then you can build something that will eventually be larger than innovating in a very new small market, at least until it gets bigger.

Hed Kovetz [00:13:22]:

But these are the pros and cons and I think, yes, identity, the fact that it's so complex that there are so many solutions in there. It definitely make it one of those markets where it's almost too scary to come near it. I think for a lot of other startups, it was too scary to even touch it. Now, by the way, it's changing. I feel like Identity is becoming hotter. There are more startups that have the courage to try to go after Identity. It looked like an old player's game a few years back, but that's what I think NWS should look for. Where is there something that is actually a big category but it's lacking innovation? People have been doing it the same way for a very long time and maybe you can do it differently.

Andrew Monaghan [00:13:59]:

Yeah, it cast my mind back to when Palo Alto came in the market for firewalls. Firewalls. Whoever wanted to go work for a firewall company back in the early 2000s. Right? There's Checkpoint, there's Cisco, and not many others. And growth is like 4% per year or something like that. But look what they did, right? They approached it very differently and really disrupted that whole market.

Hed Kovetz [00:14:21]:

The reward is also bigger if you can do it. Yeah.

Andrew Monaghan [00:14:23]:

Well, let's move on to your second decision Hed.

Hed Kovetz [00:14:26]:

Okay, so the next thing we went for it and we built something and eventually we really got something working and finally it was time to start going to market. Now, of course, the first few customers you have to find and we can have a whole conversation about how you find your first customers. Right. It's very hard to find those people who believe in you probably believe in you more than even necessarily the product. But you really find someone who has that entrepreneurial mindset and they can really be that early adopter. But then you get to a point where you want to start scaling. It's not really scaling because it's pretty early, but you want to start getting a few more customers and not just going door to door. And there are different approaches to how to do it.

Hed Kovetz [00:15:13]:

And what we did pretty early, which I think was an important decision in the long run, was to invest a lot in partnerships and channels, which is not trivial when you are early on. I think that I got advice from different people not to do it so early. Now, just to be clear, it wasn't that early. It's not like I was trying to get my second customer to a channel partner. Okay, it wasn't like that. But it was at the point where I think most startups are still mostly going door to door using their connections, using advisors, using their investors. And it was clear to me that I wanted to build something that is actually scalable. I think that, by the way, is part of that mentality we just talked about of when you build something that is like a relatively long journey, one of the benefits is you get used to thinking relatively long term.

Hed Kovetz [00:16:01]:

You don't just build something in order to sell it two years later. I mean, the company. So you invest in things that maybe don't have an ROI that is very short term. And one of those things is channel partnerships, because I think everyone who built a go to market that is really focused on channels has seen that it takes time to get the return. You start by feeding them a lot and enabling them, and you don't really get much in return.

Andrew Monaghan [00:16:27]:

HED are you talking about traditional security reselling channel or some other type of order?

Hed Kovetz [00:16:33]:

In the beginning, yes, and in a minute. I'll also mention a few others that I think are very interesting that we built over time. But initially, yes, it was the vows and the distributors in certain regions where we didn't have people on the ground. I think that the challenging part in this kind of decision is you don't get returns at least early. Right. You have a deal that you found, you qualified, you won, and you just feed it to a channel partner and there's nothing coming back in return. And that took a lot of conviction in that strategy, doing that again and again, even though you're getting less, you were losing some margin there and believing that, yeah, maybe it will take time. So it's not a disappointment that it's not happening right away, but over time it will be just a better way of scaling the business.

Hed Kovetz [00:17:22]:

Investing is daily is very difficult, especially because investors want to see more arr. So if you're giving up on some of that are early on, it's a lot like it means a lot. Every dollar is painful to give up on. If you know that it will serve you two years from now, who cares what will happen in two years, right? It's so far. I just want that extra dollar right now.

Andrew Monaghan [00:17:43]:

And to be clear, in those circumstances, you're paying your own team and you're also giving margin, usually quite healthy margin to the reseller because you want to incent them to give you at some point something back.

Hed Kovetz [00:17:55]:

Right.

Andrew Monaghan [00:17:56]:

It's to get into something back is the hard thing is what you're saying, you know, it's not going to come immediately, it's going to take a few months or longer.

Hed Kovetz [00:18:03]:

I think that's true for partnerships in general, because I think that over time when this actually started to pay off, it did. So, just to be clear, over time, partners became a huge source of pipeline for us and a huge force multiplier for us. We do the majority of our business through channel partners, and we get a lot of business from them that they source. But that took time. So just like that other decision, it's easy to sit on the other end of that. Not the end, but some are farther along that journey and say, hey, that was an obvious decision. It wasn't and I think that with partnerships in general, there's a point there where it's very easy to give up. I think that's true for a lot of partnerships where you invest a little and you don't get much in return.

Hed Kovetz [00:18:46]:

And I think the instinct of many people, especially startup CEOs, who want to get really quick results is let's give up and let's do something different. You always switch. You switch, you change, you try this, you try that because that's what they teach you to do when you build product and you need to be very agile. I think that the thing that I had to learn is when you build that partnership you need to fight your instinct to give up. And actually, if it's not working, sometimes you need to lean in more and you need to do more and figure out what do I need to do in order for this to really start going.

Andrew Monaghan [00:19:19]:

What did you learn about the type of partner, though? Because not all of them would be great partners for you that early?

Hed Kovetz [00:19:24]:

That's a great question. I think that what I learned is that some partners really know how to work with smaller startups and more emerging technology and a lot of times they are not the biggest partners. They are the more local regional boutique partners that can actually have the attention to give to a startup because they're not the biggest, right? So they have to be the most innovative. They have to be the ones that bring new technologies because if you're the biggest player, you don't you can just sell the big vendors and everybody comes to you. Those small ones, they have something to prove which is kind of similar to a startup. They need to have a reason for those customers to work with them so they want to bring new technologies. I also learned that the key is to really get the technical people there, the Ses, convinced because they are really the ones that if they get excited, even one person, I need one person in this one reseller, one Se to get excited because they will get you into two accounts. They just want to solve those problems for those customers and they really understand your technology, which sometimes the reps don't and they are the ones who start driving it.

Hed Kovetz [00:20:26]:

And then when the reps smell money, then they all come and then they all want to walk with you but they're not going to jump on you right away because there's no money coming from you. In the beginning, the Ses might and you need to really invest in them and enable them and get them excited in your technology. And sometimes one person really gets it is enough. That's one thing I learned. The other, as I said, is a lot of it is really you really need to build a relationship. It sounds obvious, but sometimes it's really that both sides really need to believe in that partnership and want to promote it. And a lot of times it's just a personal connection, not necessarily mine, but like the sales reps or whoever is managing that partnership need to really have a relationship and need to go out there, need to meet them, need to go to their office, need to host a lunch and learn with a few of their clients. Needs to be there, needs to be at the top of mind.

Hed Kovetz [00:21:17]:

That's the thing that you can do as a startup. You're not the biggest, you don't have a lot of revenues, but you can actually be there. You can spend time with them and invest in them, especially with those smaller ones that maybe not all the big vendors are. And then as I mentioned, you need to sometimes lean in and really not pull back, which is your instinct, but actually figure out what more can you do. And another example of that is over time we started building more types of go to market initiatives and partnerships. For example, we found cyber insurance to be a really good strategy. So cyber insurance tells customers they need to buy certain product if they want to be insurable. They want to be able to get insurance and it's getting more and more strict every year.

Hed Kovetz [00:21:55]:

And we found that if we can tie our product to how can we make those companies insurable, we can actually build partnerships with the insurance brokers and carriers. That was another one where it's an ambitious target to really get to a point where you work with these guys. But we leaned in on it. We said, okay so it's not working, so we're not going to give up on it. The opposite, we're going to figure out what we need to do? So we have two full time people running this strategy, one in EMEA, one in the US that are just spending time with these insurance partners, figuring out the program, the model, going, doing roadshows with the brokers, sharing success stories from the customers who actually did it successfully. And now it's becoming a big source of pipeline. We're getting tens of deals every quarter that just come from this source. And again it took time, again it took not giving up where there was no result, but actually leaning in.

Hed Kovetz [00:22:45]:

Now you do need to, obviously you can't lean in on everything. So you need to have some understanding of where are you going to focus and which partnerships do have potential. But that's where in all these cases and there are a few others, right? We have a great partnership with Microsoft and other technology partners. That was a similar experience where a lot of startups just tried and gave up and hey, we're not really getting much from them, they're not getting us deals. And we just leaned in and figured it out until we really got to a point where we're getting from these technology alliances, including microsoft hands of deals because we really spend the time and figure it out. I think you really need to believe in partnerships as the way to grow because you can't invest in everything. Right. You need to figure out what is your strategy.

Hed Kovetz [00:23:27]:

But I believe in that, and I'm glad that we started it early on because that's why I can sit here today and say it actually works. Right. If I would start it today, I would only get the results later on. So I'm actually glad we started early.

Andrew Monaghan [00:23:38]:

Yeah. If you're getting that number of leads through opportunities, through from partners, then clearly it's working. As you say, you don't build a partnership in a couple of months. It takes a while for it to really embed and trust builds up and relationships build up and suddenly things start flowing. So really like how that pulled through for you. Hed, before we wrap this up, let's get to know a little bit more about you. I've got a list of questions here. Believe it or not, I have 35 questions.

Andrew Monaghan [00:24:07]:

The good news is I'm not going to ask you 35 questions. I'm going to ask you to pick three numbers between one and 35, and I'll read out the corresponding question.

Hed Kovetz [00:24:16]:

Okay. Two, nine, and 21.

Andrew Monaghan [00:24:21]:

All right. Number two is iOS or Android.

Hed Kovetz [00:24:25]:

Android always. Android always. You got to stick. If you pick one, you need to stay with it because switching is so painful. Yeah, I like my android.

Andrew Monaghan [00:24:35]:

It is painful to switch. I can't imagine. So I'm iOS guy. I can't imagine having to go through the probably days, if not weeks of work to try and switch over to something else.

Hed Kovetz [00:24:44]:

Yeah. My wife has iOS, and if I need to use it, for some reason, I think it looks so unnatural. But I'm sure it's the opposite for iOS users.

Andrew Monaghan [00:24:57]:

I'm sure it is. All right, number nine, what's the first hour of your day look like?

Hed Kovetz [00:25:03]:

One of my kids wakes me up because I have small kids. I have a one and a half year old and a four year old. So they wake me up, and then I need to jump right into the I don't even have a minute to understand what's going on. I need to immediately take care of them, get them to school, and then start my day. But the good thing about it is I actually wake up. I had a problem waking up years ago. Now it's not an issue. Like, I'm I'm up.

Andrew Monaghan [00:25:31]:

Yeah, I think it is funny. I was reading something this morning, actually, from some guy who clearly didn't have kids, who said, on the first hour of my day, as I get up and first of all, I meditate and then I do this and I do that my day. And I was like, yeah, clearly you don't have kids.

Hed Kovetz [00:25:48]:

Exactly. But again, I'm not a morning person. I used to barely get. Up from bed. Now, the good thing is I can walk till late hours and it's really easy for me, like in the nighttime. But now because of my kids, I actually wake up and get effective pretty quickly, which is actually good.

Andrew Monaghan [00:26:09]:

All right, what was the last number you picked?

Hed Kovetz [00:26:12]:

21.

Andrew Monaghan [00:26:13]:

21. Would you prefer a good book or a good movie?

Hed Kovetz [00:26:17]:

It's a good question. I think that I would prefer a good book, but it obviously takes a much longer time and I read so much during the day on my walk. I sometimes enjoy a good movie better, but when I have time to read, I really like a good book.

Andrew Monaghan [00:26:35]:

And you prefer fact or fiction?

Hed Kovetz [00:26:37]:

For fiction usually, yeah, I watch movies or read books in order to disconnect a little bit from the pressure of the day to day life, which for a CEO is a lot. Right. So I want it to be very different from reality.

Andrew Monaghan [00:26:59]:

Let's move on to the third one.

Hed Kovetz [00:27:01]:

Sure. So the third one is a little different. It's not really about the go to market strategy. It's something that I think a lot of people talk about, but I still want to talk about it because I feel like we've done a lot to really invest in that aspect and that is our decision to really prioritize culture and team. I know it's a very common thing to say, especially in startups, right. Investing in culture, investing in people. It's kind of like you almost have to say it if you're a startup. But I think that it also goes back to my decision to start a company in many ways was not even about wanting to build a product in identity.

Hed Kovetz [00:27:41]:

I mean, that came when we wanted to figure out what are we going to do, what product will it be? And you may be surprised, but it didn't even come from my wanting to get rich. That wasn't the motivation. I think that a lot of the motivation there was really building the kind of company that I would have liked to work for. I think a lot of the motivation to even start Silverford was wanting to create a workplace where people would be treated the way I thought they should, where I actually control that and I can create that environment. Which is why along the way, that was always a key thing for me to make sure that I did properly. One is because, again, that was a lot of my motivation and my passion is really there. And second is because I actually believe that that's a key element to making companies successful. I think that in general, the advantage of a startup company versus a very large company is the fact that somehow a few small number of people are actually able to do above and beyond the numbers.

Hed Kovetz [00:28:42]:

They somehow do these amazing things and go above and beyond and be creative and do incredible things and I think that has everything to do with how much they care about that company, right, and about their success. And people can say, hey, that's because they want to make money and they want to move their career. That may be true, but I think that most people, day to day, a lot of what they do and how much effort they make is really for people. They can tell themselves a lot of it is for money or for whatever, but a lot of it is really the people around them ahead.

Andrew Monaghan [00:29:11]:

So you're right. I mean, this is something that you say it's almost number 15 on the checklist of things as a startup is tell everyone that you're a people first company or some version of that. So let's get a specific stem. What have you done specifically to really drive that?

Hed Kovetz [00:29:26]:

Sure. So I think that what we've done throughout the history of this company, whether we were smaller or even now, is to really make sure that employees feel valued and work as one team. And that is again a very generic thing to say. But what it really means to us is we try to make sure that the whole company works as one team and not as different departments that are almost enemies. Which I think is the case in some companies because they have different interests and they're trying to achieve different goals, but really make sure that the company works as one team that is trying to win the goal together. In the sense that we really try to not argue over whose fault it is when things go wrong, right? I couldn't care less about whose fault it is that we lost this deal or we couldn't deliver this product feature. It's more like how do we improve as a team? How can people really help each other even if it's outside of their job? So if you need help from that other person and even though it's your responsibility, do I really have the kind of people that will come and help without questions? Just because, again, that's the startup thing, right? We are all one team trying to win together. It's also about when people are struggling.

Hed Kovetz [00:30:37]:

And we all know sometimes your employees are in a bad place with the family or their house or anything else that is challenging for them. It's really the place where I think it's most important to invest in them and help them because that's the point in time where they realize that you actually care about them as people and not just the work, right? And I think that if you do a lot of these things and more right, those transparency and those really making sure that we worry about career paths for people and how they progress and investing in them in many different ways. If you do a lot of these different things that we can talk a lot about, I think you get to a point where people really feel like it's their company and they feel like this is their team and it's like a place where people care about them. And that's the only way where they are going to care about the company. Because again, they can make those salary probably even if they don't go above and beyond. But I need them to go above and beyond. I don't need them to just do the minimum to get paid. They need to do amazing things, right? They need to do creative things.

Hed Kovetz [00:31:36]:

And I think they do that when they care about the company and when they care about the people around them. I think a lot of people that leave companies live because of I mean, they say they live for a better salary or whatever, but really they live because of people, because their manager or something usually is the real reason. And we got to a point where we have almost no employee attrition in the whole company. We have more than 250 employees today. We have between zero to two people living voluntarily every year. So less than 1% decided to leave the company. Not that I think this will stay true forever, right? Obviously we're getting big. But I think that it's something that to me is very, very important.

Hed Kovetz [00:32:13]:

Because not only it mean that I can retain my people, the talented one, and make sure they're doing a good job, which I think is critical. It also means that people are here because they like it here. They believe in the company, they appreciate the way we care about them, they actually work together in a team. Now, I have to say this is easy to say a lot of these things transparency and caring about employees and so on, it's investing a lot of time. And that is, I think, what makes the difference. I actually spend a lot of my time on that because I kind of feel like when you have a good product and you have a good market, the most important thing for the CEO to really do is make sure you have the best people and that they work well together.

Andrew Monaghan [00:32:51]:

I was going to ask I think it also means that you must be hiring well, right? You must have focused on or dialed in what it takes to hire the right sort of person who isn't going to naturally attrition from you, right? I wonder if you get any learnings from trying to pick the right people.

Hed Kovetz [00:33:05]:

It's true. I think that that also has cost to it, which is time and attention. For example, I still interview almost every person that comes to the company. I'm not the one making the final decision. A lot of times it would be the manager, but I also interview them, not because I know better than the manager how to do marketing or sales or DevOps, but because I feel like I bring the element of what is that culture? What is that thing that I need people that come here to have in order to really be team players? Not just say that they are, but truly want to work in an environment where people help each other and are not looking to point fingers, but are really trying to win as a team. And we had a lot of cases where you say hire well, but part of it is also not higher sometimes, even though it's a very talented person that is very high performer. And you talk to them and you feel like that's not the personality and it means that we may have to not hire them even though they look excellent professionally because of it. And sometimes it's hard for the managers to understand that, but I think that they do because over time I think they have also seen the value of this approach.

Hed Kovetz [00:34:12]:

And I think that's crucial because I can sit here and go on podcasts and say, hey, I believe in all these things and culture and so on. It's almost meaningless at our size because it's really the team leaders that really affect what people feel, right? So I can say all these things, but I really need to have managers. And in that aspect, the lowest managers are the ones who matter most, that they are the ones who actually impact how people here feel, how they feel valued. Do people care about them? It's not me. I can speak to the company here and there and I obviously intervene in special cases, but I really need the managers to get it. I do call sometimes with the whole management team, including the team leaders, and explain to them a lot of things in the kind of things we talk about here, obviously on a deeper level of how to handle certain conflicts of responsibilities and what to do if someone is becoming very passive aggressive with other team members. Like a lot of things where you'd say why is the CEO even dealing with that? Why is that not just the HR? But I do that because I think that's at least as important, sometimes even more than the product or the sales organization, right? It's like the fact that that whole thing, that whole machine is working as one, not as just different pieces that are fighting with each other and slowing down the whole company.

Andrew Monaghan [00:35:24]:

Had I was just thinking through what we've talked about in this interview so far, and I think one of the words that comes to my mind to summarize this for everyone is the word conviction. So you and your co founders had the conviction to build the right thing that was needed, not just the easy thing that might have got by. You had conviction to when it took a long time to get there. You had the conviction to follow it through, even when you probably had other people telling you there must be a faster way. You had the conviction of building the partnerships that you really needed over a long period of time, as opposed to thinking after two or three months, this isn't really working that well, let's go try something else. And then you have the conviction to really follow through on the people side and make sure you hire the right people and really retain the right people. So that's my big takeaway from this conversation in terms of one word to wrap it up for me. I'm sure the listeners will have something completely different if they want to get hold of you Hed and continue the conversation or get in touch and ask you some questions.

Andrew Monaghan [00:36:17]:

What's the best way to do that?

Hed Kovetz [00:36:19]:

So first of all, people can reach out to me directly either via LinkedIn Hed Kovetz or even my email it's hed@silverford.com. I'm happy to talk with people again. I talk to entrepreneurs a lot and trying to help because I got that from when I started and also until today, right, from entrepreneurs of larger companies that were helping me. And I'm always very happy to help anyone else where I can. I think that's our strengths as an industry, that people really help each other succeed and we're not trying to fail each other, but we really give each other advice. I think that as entrepreneurs you really, really need that because it's such a lonely role, especially CEO, such a lonely role. You need other people who are going through this or have gone through this and talk to them about it, even just to not feel so alone. So people are welcome to do that and if they want to get to talk deeper about any of these things, I'm happy to do that.

Hed Kovetz [00:37:11]:

And I agree with you. I think conviction is the key here, but I think that's a general thing for entrepreneurs in general and CEOs. That's the thing I mentioned earlier where I think that the biggest test is can you really get up after something brought you down, afterwards something didn't work out or something looks like it's not going to happen? And can you pull yourself together and be that person that gets back to a productive mode and be optimistic? I'd be realistic but optimistic and try to really get that thing resolved and not just say, hey, it's not working. That's not going to take you anywhere. And that conviction is key. But obviously you can't do everything. You can't have conviction about every possible strategy. You need to choose a few.

Hed Kovetz [00:37:57]:

And that's the area where talking to other people who have done it is probably the most important thing that I try to do. Just whenever I need to make a decision about a strategy, like, what am I going to do? I talk with at least a few people who've done it. I don't try to fall in love with my own decisions and I hope that I never will get to a point where I think that I just know how to make all those decisions. I think that's also the thing about being a CEO of a company. Every year is like a whole new task that you know nothing about. It's like a whole different scale, it's different decisions. So it's a constant filling of I don't know enough. I really need to talk to a lot of people in order to figure out what I need to do properly.

Hed Kovetz [00:38:35]:

And I think that's something you must never lose. Otherwise, you start to think that you know best and make mistakes.

Andrew Monaghan [00:38:42]:

Well, clearly your strategy of talking to others and getting their input and all the rest of it is working. Well. Silverforce has been on a terror for the last few years. Just looking at the growth numbers of these employees and LinkedIn and some of the things you shared with me, it sounds like you're on incredible path, so congrats on that. And encourage anyone who wants to get in touch, please get in touch with him.

Hed Kovetz [00:39:00]:

Yeah.

Andrew Monaghan [00:39:00]:

All right, well, thanks so much for your time.