Navigating Economic Uncertainty and Driving Long-Term Growth – Steven Mitchell, Redgate Software

This is texturing TV. Hey everyone, welcome back to techstrung TV, you know here on Tech strung. We we interview a lot of CEOs a lot of CTO CIO Chief digital officer chief that Chief that's a lot of tech people.

We don't know interview enough CFOs Chief Financial officers. Right and it's because our audience is a tech audience and a lot of times they don't. get quite as excited about, you know, Gap analysis and stuff like that, but We live in interesting times right now, right?

There's no hiding the fact that at the tech industry the subject to the same economic cycles that the rest of you know the world economy is and whether it's a court because of interest rates or inflation or other macro factors that you know, we've lived through these last couple years. We've certainly seen a A new era for many in Tech, especially for those who've only been in Tech maybe 10 years and it's always been High Times right free money. crazy money raises and valuations and we can't find higher enough tech people.

Well things are changing a little bit. My next guest and I are going to talk about it. I want to introduce you to Steven or Steven Mitchell Steve is the Chief Financial Officer for Redgate software Steve.

Welcome to techstrong TV. Hi Alan, gradually with you great to have you on Steve before we jump into this whole. Kind of pattern I laid out there.

I wanted to ask you if you wouldn't mind sharing with our audience a little bit information about yourself. About your own journey and then a little bit about Redgate software for people who aren't familiar. Yeah, sure.

So my background I started out training as an accountant in practice. But but for a lot of my career I worked in telecoms. So in TMT, but in the parts of the parts of that where the businesses are more established and actually growth is is a lot harder to come by it certainly at the rates.

We see in a lot of tech companies and I probably spent half half of my 15 years in telcos working outside of the finance function. So I spent time in strategy in marketing and working more commercial and and sales teams. Before coming back to the finance but but didn't spend too much time in in the technology teams.

I was an outside in looking at the technical teams and trying to understand bits of what they do and then coming more recently to Redgate. I just joined here a year ago. It's my first time working in a software business and in a much smaller business as well.

So at Redgate we're just approaching 500 500 people. So I'm learning as I go. But certainly I I've got got a few initial views on there on where we can go as Red Gate and I'm sure there were similar things for a lot of other tech companies outside and other sizes absolutely five hundred is you know, it's a decent size startup decent sized Company Steve.

Business of Redgate if you don't mind a little bit before we jump into it. Yes, we are. We're a software business.

It's all B2B and our software. We're about 23 years old entirely entirely bootstrap, basically since the very late 90s. And we've grown up really in in the database world.

So initially supporting database administrators working with Microsoft SQL Server databases, and then more recently moving more into database devops and really trying to support businesses making the most of out of their data on on any platform anywhere there. They're holding that data so that that's what we're all about. And we're, you know, we're continuing on our journey to to do that.

Absolutely, and you know it let's not trivialize it. I think one of the lessons we've learned over the last two to three years is that it is all about the data, right? We almost forgot that we were so focused on applications and and cloud and and all of these great Technologies, but at the heart of it all is the data, right?

That's that's the crown jewels. That's the money and so good place to be in so Steve. You heard me intro yourself to the show today.

We are living in. interesting times in the tech world for many of our younger Audience members they've never known. tough times in Tech For our audience out here whether you're in the CFO side of things Administration the business side of the Aztec side of the house.

Give us some advice. How can we and how can CFOs and those like yourself help? What can we do to you know, we have to do we have to stretch our dollars.

We got to do more with less. We can't stop growing. What what what do we do?

Yeah, that's it. And I think the first thing we should recognize is that what while there are ups and downs and and you know, we're going through some uncertain times now and that's you know, political uncertainty economic uncertainty Financial Market uncertainty. nonetheless, you know the tech sector is still very strong and you know, we see headlines of you know, big Tech layoffs and and so on and other Tech layers over the last year, but but then it's really good to see that it's also being noted pretty often that that actually even you know, the big tech companies have Of reduce their Workforce a little bit, but they're still a hell of a lot bigger than they were three or four years ago and it's similar, I think but you know for different size tech companies.

So first of all, we shouldn't overreact and we should we don't have all the Tailwinds of growth that have been there for you know for a good number of years now and I think it changes as a business you whether you're the CFI or any other leader in a business it these answers the uncertainty sort of changes how you think about some of the decisions that you make and I think the first thing that we need to do as Business Leaders is just be as transparent as we can with the people in our organization about why we're making the decisions we're making because you know, I remember sitting on the other side of things and it's incredibly frustrating if you've got a project or you know, now if you're a if you're sat in a product development team and a software business and suddenly know you can't hire those extra roles anymore and and it's going to delay what you're trying to function if you don't understand the rationale behind those decisions that that's probably the single most frustrating thing when you're you know, when you're in a business in those roles, so I think Communicating the rationale for why they're there might be changes is key and then and then I think thinking about as a as a finance person, you know, you you learn a term as you come through your training as a junior accountant if you like the school discretion we spend and and it's sort of Builders anything you haven't contractually committed to or you have to spend right now to keep the lights on in your business and there are some businesses that will get to a position where they need to think about things that way but for most businesses, I think the key role of a finance team and a CFO is to is to not move too quickly to make cuts that we think are just we might think of us discretionary might be easy decisions. Now that that might have much longer term implication negative implications for us. So to give you an example the easiest thing for me to do when times are uncertain is Slash the training it slash the learning of development budget, you know, we here at Redgate all of our product engineering teams.

They have you know, they have 10% time where they, you know, they can go and use that 10% of their time on learning a development or on specific projects. They're interested in outside of what they're doing day-to-day, you know, they run exposed they do annual routine. They have full days of training when the whole team, you know, the whole division is offside.

It would be really easy to look at that and think well, that's a lot of time and money being invested. Let's stop that. But but the reality is, you know, we we then be removing a lot of the reasons why great software Engineers stay and develop their careers in our business.

So I think you know coming back to a question. That's just one example of where as Business Leaders. We need to not overreact explain why we're doing what we're doing and and try and make sure that we're still balancing thinking about the long term with you know with the need to make decisions in the short term.

Love it. You know. The lot packed in there Steve, right?

I think you're opening room. You know kind of point is is really something though that I want to emphasize with our audience. When you hire a hundred thousand new employee employees over the last two years.

And then you lay off 10,000 of them. You still have 90,000 more employees than you had three years ago, right and yeah, that's kind of where we are. In the tech industry, right?

We did we overhire during covid. Yes, sir. But you know.

Look at 2018-2019 to now. We see tremendous tremendous growth. I think the other part is and not to get too Financial with our audience.

But when you're dealing with a zero interest rate or there about or in some cases negative interest rates, right? You know the whole money equation and and now within a year you go up 500 basis points right or something like that. Right?

And of course that money equation is gonna shock the system. And and those shocks will have repercussions that will set waves off. But if anything not just the tech industry, it seems like the whole economy has been really resilient when you look at, you know job numbers and everything else we do.

I want to bring up one thing though that you didn't bring up which is seems to be having some effect here. And that is this whole AI thing. People, you know, first of all, there's so much money being thrown at AI right now, right?

And people are talking about it. Well, we we can maybe make do with less people because AI is gonna help us here. That's something read the tech industry always looking for a silver bullet, aren't we but you know in spite of how cool Chad GPT and all this stuff is I I still think as I think you alluded to that people it's about data and it's about your people.

And holding on to people's best you can and giving them. a pass of growth is is the key to success good times or bad times. Yeah, I think that's right.

Yeah, and that yeah it obviously. you know the the advances in AI I've been there but the profile it's got right now is is making a lot of people an individual level as well as a corporate level, you know introduces some some nervousness and uncertainty and no doubt it will yeah, it will change things and change the nature of some roles. But but I would absolutely agree.

It's not going to change the need for great people and it's not going to change the need for businesses to to support the Learning and Development of the great people. They've got if they want to keep hold of them. And in times, you know, when times are tough and especially, you know, when we come out of Uncertain times then you know, that's when really you're you know, your your best people are those even in tough times.

They're the people that will feel most confident that they can go and find a role elsewhere. So it becomes you know, at least as important as ever to you know to treat People really well. and and make sure that you know that you're the place that they want to stay and and develop and and that development for those people might might include changes to their role or enhancements to what they do or AI make their You know their roles more interesting.

I I wouldn't profess to know just yet, but I'm certainly not sat as a doommunger thinking it's awful for people or as or celebrating as a with a pure Finance hat on that I can suddenly do without you know half of my developers because AI will just do that and we won't need to pay for their month. You know, that's certainly not not my view at the moment. Absolutely interesting.

interesting stuff so Steve How how do you and if you want to talk specifically about Redgate feel free, but if not, you know in generalizations, let's talk about this investing in your employees. How does that manifest itself? You think?

I think yeah talking talking from a Red Gate perspective. I think the the investment that we you know, how we View. the development of our employees over time is that we You know.

We've got a history of bringing people into junior roles and see not just in in Tech roles, but but across our business and seeing them develop over time and some of the senior leaders in our business are people that started out 15 years ago in entry level roles. And so you know for us and I think it's the same that most businesses when you see that and you see how effective those people can be as leaders in a business where you know, they they know the business intimately. And they've got that experience, you know, it's it's great to know that you can do that.

And and for us the value that that brings is is fantastic. And when you're when you're when you're expanding and hiring the way that we are you're then mixing, you know, that experience across all levels of the business within your business with people that are coming into the business and and bringing in the fresh ideas and the fresh perspectives and challenging some of the ways we do things which we always look for as well. So, you know on the ground what that looks like for us is firstly, you know, incentivizing people.

Let's not pretend Financial incentives aren't there aren't a key driver for most people so last year as an example. We introduced a long-term incentive plan. That's you know, that's based on the growth in the value of our company over time and it and it's available to join for every permanent employee of our business.

So I think having having incentives that are there where everyone can feel it if the outcome is right if we grow the value of the business then you know, the owners of the business that have put the investment in up front a happy but also all of us as employees in the business feel like we're getting we're getting something back for all of our time and effort and energy as well. So I think there are there are things like that drive just driving alignment of objectives and getting people engaged in making the business a success. Um, and then our investment a lot of our investment then goes into into training and development into into recruiting the right people.

So I think again most businesses will have You know have have a set of values and a culture in their business a way they work and and making sure that we're hiring people in that can help us evolve but can be into that culture and part of that culture is making sure that we're we're then offering the right development paths to you know to people in our team. So when I join the business as a leader part of what I do is is make sure you know across my team and then link that to the broader business that we've got development plans in place for each individual within the team and that we're willing to invest money in in helping them develop their their skill sets and their careers love it Steve. We're about it.

Actually we're overtime, but for people want to get more information about red gates software. Did we mention the website? I don't remember I'm not sure if we did but I will mention it now.

com and they'll find out all about us our products and our career opportunities there. Fantastic, Steven Mitchell Chief Financial Officer Redgate software here on techstrong TV. We're going to take a break.

We'll be right back.