ServiceRocket founder started company because he had a passion
Cynical about today’s startup scene of quick exits and flipping
HE’S the founder and chief executive officer of a company with more than 130 employees, and offices in four different countries. The company’s customer list reads like a who’s who: From big retail giants to old-school technology giants and up-and-coming Web 2.0 firms.
He’s been invited to speak at entrepreneurship conferences, was a casual lecturer at the University of Technology in Sydney over a span of seven years, and was the president of the San Francisco chapter of the Entrepreneurs' Organisation (EO) for 2011-2012. EO itself has nearly 8,000 members worldwide. He also sits on the Young Entrepreneurs Council out of the United States.
Don’t worry if you haven’t really heard of him: Rob Castaneda (pic above) of Sydney-founded ServiceRocket, originally CustomWare, still isn’t sure he’s quite got the hang of this whole entrepreneur-startup thing.
“I think the word entrepreneur came to me in 2006 when I was invited to join the Entrepreneurs Association in Australia – I don’t think I even knew how to spell the word ‘entrepreneur’ then,” he chuckles.
At the time, ServiceRocket – which provides support and training services and products to software companies, as well as directly to large enterprises which use a lot of software – was the 16th fastest-growing company in Australia in all industries, and the second in IT.
“I think I am a natural entrepreneur, but I didn’t start the company thinking about business opportunities. I started the company with a genuine passion to help people get the most out of their software,” Castaneda tells Digital News Asia (DNA) in a recent interview at the company’s Kuala Lumpur office.
He must have done something right. According to Castaneda, ServiceRocket has invoiced over 2,300 customers in the last 12 months. Its customers include Atlassian, Citrix, Cisco, EMC, IBM, LinkedIn and even Malaysia’s own Maxis.
“We’ve been helping all of them get more out of their software,” he adds.
Castaneda founded ServiceRocket in 2001 when he was 21 years old. He had joined software company Borland International Inc at a time when the company was a credible rival to Microsoft Corp, when he was only 17. Starting at the helpdesk, his experience there would later be the genesis for ServiceRocket.
Borland is now known as Borland Software Corporation after it was acquired by Micro Focus.
“When I started this company about 13 years ago, startups weren’t a separate thing. You just started a company,” Castaneda says. “An incubator was something for eggs.”
“I’m a little bit cynical with some of these incubators because of some of their motives,” he says, choosing his words carefully.
“What some of them are doing has nothing to do about building a structured, quality business that’s made to last. It’s like gambling, with quick exits and flipping in mind.
“And what I see is a lot of young kids who have passion and knowledge in a certain area, but they get shoehorned into a programme, and they think that that programme is the definition of success … because there’s no other measuring stick,” he says. “Building a company with values and a foundation is not what they think about.”
“It’s taken me 13 years – and a whole lot of hair – to build ServiceRocket and everything else that goes with it. I don’t think everybody has to go through 13 years the way I did – people smarter than me can do it a lot quicker,” he adds.
Castaneda does not believe that incubators – accelerators as they call themselves these days – can prepare entrepreneurs for what they will really have to go through.
“Part of my measuring stick for an incubator is whether the people running it have been through an incubator themselves before, or are they just looking for opportunities to invest. Have they built their own companies before?” he says.
None of this means that Castaneda does not get involved with entrepreneurs, of course. As mentioned above, he mentors university students and delivers talks in many different places. Click on the video below to hear what he has to say of the challenges of rebranding a company, from his experience rebranding CustomWare into ServiceRocket.
“I mentor a lot of individuals,” he says. “I’m very generous with my time if somebody is trying something out, but I will respond as a mentor – I don’t invest in other people’s businesses, and I think the founders and entrepreneurs should hold on to as much equity as they can, for as long as they can.
“The only problem is, it’s very hard for entrepreneurs to get any kind of external validation and support [with this model] … unless they give away equity.
“A good part of my own journey was actually learning to be confident and comfortable with what my gut was saying, even though I couldn’t validate it with anybody. It’s a painful thing, when you say ‘Hey, we really should do this,’ and those who haven’t done it, say ‘No, you can’t do that.’ ”
A good example of that was when ServiceRocket decided to go into Latin America, which also underlines the importance of getting the right kind of board members for your startup. The company’s board include a couple of senior executives from Borland and another company he had worked with before.
“I think we were lucky enough to get to a position where we built a board that will challenge me to explain my reasons, but at the end of the day, is very supportive. When I pitched to them that I wanted to go down and set up an office in Chile, and gave them the research, it may have been a big challenge, but it wasn’t a 12-month feasibility study.
“I said give me 30 grand and three months, and I packed my bags and I took my whole family there for three months. Then I came back and said ‘Yeah, we should do this. Here are the business reasons, but the other reason is that my wife felt safe in the city.’
“You can’t read that in any feasibility study,” he says.
The ability to live in a city – and to feel passion and excitement about doing so – is important to Castaneda. Or that his wife can take their three children out swimming while he’s away at work, without any concerns.
He and his family did the same thing here in Kuala Lumpur (KL), moving here to see if they felt comfortable living in the city. ServiceRocket’s KL office is now the company’s biggest operation, housing 85 of its 130 or so employees.
Next up: From the man to the company, and how ServiceRocket closes the ‘software consumption gap’
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