How to build a globally distributed tech team?

Oleg

Hi, everybody. Welcome to Devico Breakfast Bar. Here we speak with different people involved in the business landscape, share their expertise, delve into the latest tech trends, and explore the ins and outs of IT outsourcing. I'm Oleg Sadikov, and today I'm excited to have Eishay Smith, CEO and board member at Versatile. Don't forget to subscribe and hit the notification bell so you don't miss new episodes. Hi, Eishay.

Eishay

Hi, Oleg.

Oleg

To start, could you please tell us a bit about yourself and take us back to your early days in the business world? What were your first experience that set you on the path of becoming a CEO?

Eishay

That's a good question. And it's a bit hard to answer because I don't know if there was a specific point in time or experience that I would say prepared me. I currently live in Israel. About 19 years ago, me and my wife moved with a baby to Silicon Valley in California, and we stayed there up to, like, a few years ago when we moved to Austin, Texas, and last year we returned to Israel. I'm currently the CEO of the Versatile. Before that, I was a VP of Engineering in the healthcare startup called Carbon Health. And I was in Google responsible for the infrastructure of a Gmail chat and other products, and also launched the security center – Google Workspace, to be specific. Google bought my startup, it was my second startup as a founder. In the first one, I was a CTO, in second one is CEO. And before that, I was in a bunch of Silicon Valley startups, like Netflix, Wealthfront, which is a big fintech by now, LinkedIn in the very early days, and couple of research labs. So, I sort of shifted on and off between very technical positions. And of course, in the beginning of my careers, it was mostly technical positions. In the early days, I also was quite a lot in startups, and I saw them grow. As you are in startup, you're more exposed typically to executive decision, challenges that they have, and so forth. And being in the Silicon Valley, especially in those days, it really intrigued me. It was something that I looked forward doing or potentially doing in the future. So, I kind of gravitated more towards starting startups or taking more leadership position over time. I hope it answers the question, but that's the best I have now.

Oleg

Why did you decide to return back to Israel?

Eishay

Oh, that's a fairly complicated question. Like, it's very typical to many immigrants, I guess, to the U.S. to always think about, you know, coming back or not. Some have more of that tendency than others. In my specific case, my older daughter decided to move back to Israel, and we followed her with a younger daughter a couple of years after.

Oleg

Okay. What do you think about Silicon Valley these days? Is it the same as it was before? What changed actually since then? Because, it was a place where a lot of startups, amazing products grew. But now, I have a feeling it's not the same as it was before.

Eishay

And even before, it depends on which point of time, right? It always evolves like us as humans, like any country that you probably know. Things change. 20 years after I came back to Israel, and, wow – everything's different, and many things are the same. And I guess it's true for many parts of the world. Specifically in Silicon Valley, it did change a lot over time. The culture changed dramatically. I would say now politics is more part of the everyday conversation in Silicon Valley than what I've noticed when I just joined in. People's willingness to take risks and work hard is reduced in some cases. And I want to be very careful about broad brush of, like, you know, it does change.

You still see a lot of entrepreneurs that make it with almost nothing and work extremely long hours. I think it was just more common back then. And we need to remember that back then – 20, 30 years ago – there are hardly people who were doing tech, compared to now. Now, it's a huge amount. And as you grow the population that comes into a specific niche, like tech. Now, it's not a niche; it's a huge portion of the industry. And it's been more standardized. Like, it should address more of the common person. Back then, you're pretty crazy to go into that direction, and for crazy people that are doing crazy stuff. Now, it's like, you know, if you want a comfortable job, technology is definitely a thing for you if you're smart. It means that the average person is slightly different than the average person back then.

Oleg

Does it mean that people became less hungry for innovation and became more lazy in general, and they want to live in comfort zone and take less risks?

Eishay

In general, in average, I think the answer is yes. But I believe that there are even more people who are hungry, and want to take a risk, and want to make a change in the world than ever before. It's just that there's so many other people in the technology industry that in average, there's less of those. But the spectrum is so wide now. And yes, there are still people who are going to change the world, and there's a lot of phases in technology, the. com, the Web 2. 0, the crypto, now AI. And there are probably a bunch of people working on the next thing that will show up in five years. Who knows what it is? Anything from, quantum to something we can't even think of right now. It looks like a minor niche. And people are basically like that's their life now, and I'm sure there are a lot of those as well. But yeah, in average, if you just want to have a comfortable living from tech, you can definitely do it and not be that hero that sees no family and friend for a few years.

Oleg

Yeah. Yeah, I had the same feeling. Could you share a particular challenging project or decision you have faced in your role, and how you navigated it to achieve successful outcomes?

Eishay

It's kind of hard. Versatile is a company that exists for about five years, even more, and making big changes is sort of hard. It went through a lot of ups and downs in different versions of itself. When I came in after a couple of visits to clients, the customers, I've made a decision to go deeper into an area that the product didn't pay enough attention. That was around the machine learning and anomalies. It's more like looking into the data in a different way and bubbling it to the customers. It was very hard because it was against the momentum we had at that point of time. So, a lot of storytelling and convincing was needed to get it done. It did get very good feedback from leadership. I wasn't the CEO back then. I shifted the position about two or three months ago. So, that was fairly easy from the leadership part, from the non-leadership part, like the rest of the team, I think it also wasn't that hard. But you know, we needed to have a goal, a mission, and I think that was, like, after I managed to, or we managed as a team, it wasn't just me, to create a very clear mission around it. Like, we came through it, and we managed to create a roadmap that fits that. This was one of the decisions that we knew that it's going to take many months, maybe six months in order to come to fruition. And there was a lot of consistency, like thinking about consistency and the fact that it's okay if we will fail. And, actually, we failed.

The first iteration wasn't that good. The second was better. The third is much better. And I think that's one of the pillars of the future success of the company. Of course, there's much more than just that. Yeah. So, maybe to summarize, the key in such big decisions or, you know, what I had back then is to try and create a consistent mission to the company and be okay with launching something initially that is not as good as we wanted. Also, shielding the team from too much back and forth, too much deviations from the main vision. Now, that's always hard in the startup, and that's maybe my biggest challenge right now, and to have more consistent roadmap, and try not to shift the team back and forth between many different ideas. I know all startups and all big companies are going through that difficulty. That's definitely something I'm experiencing within me. It's something that is hard to do.

Oleg

Yeah. It's very common.

Could you provide an overview of your current project with Versatile you're actively involved in and elaborate on the specific challenges or issues it addresses?

Eishay

So, the current, the main challenge or project we're going through now is that understanding of the insights out of construction data. And there are a few dimensions to this challenge. First is finding the interesting parts, finding what is good value for our customers. And for that, there's a need to really understand the technical, the domain, and that's a big challenge from an engineering perspective. Most of the anomaly detection style work that you see in the industry are serving engineers. Like, there's a lot of work in security for an anomaly detection in a production environment. And by that, I mean, production of data centers, database, network. Engineers are building tools for themselves. And that's fairly easy because you sort of know what you're looking for. And if the machine learning spits it out, then, you know, it's good. In our case, the customers or the production environment is a construction site. It's a real-world construction. And it's very hard for us to understand the mentality of a site. It's, you know, we were blessed that the founders, they're like much more engaged with the site than we are on now. It's kind of phased out, and now I'm in a situation when I need to send my product managers or myself to sites again and again to really understand what they're looking for and what are their challenges.

The second challenge is how to make it accessible. You know, what is interesting? How do you make it so that in their busy life, typically they're not techies over there. They love technology, but that's construction technology. In terms of software and so forth, you know, the best thing we can do is to get out of the way and provide very concise pieces of data that give them value, and that's it. Cause they really don't have time. They have so many problems in their day-to-day life. So, for us to understand how to do that efficiently without annoying them and give them the value in the least amount of time is not trivial at all. So, it's all about the friction and the accessibility of things. And I'm very sure that if we won't nail these two things concurrently, like the what and the how, the company won't make it. Like, this is the key for success. We have to have them both. I can't have the best data engineers, and data scientists, with some, civil engineering, you know, people to support them, and they'll provide the best thing, but the UI sucks, and there's no healthy user research, and, you know, it's not going to work. And the other way around. Yeah, so that's why user research in that world is extremely challenging and rewarding if you get it right.

Oleg

Looking ahead, are there any emerging trends or technologies in your field that you believe will have significant impact on the industry you operate in the near future?

Eishay

There are many startups that are trying to provide visibility into how construction is being made. We're doing it from the angle of productivity. But there's others doing things that from quality assurance, people efficiency, and other things. The technology that I see blooming now are all aiming to provide visibility and better decision-making into what's going on. If you'll think of a construction site, and by the way, our construction sites are anything from 100 million dollars to a few billions of dollars, so we're looking at the higher end. I think it's true probably for any kind of construction job. You can think of it as a factory that is being created around a single product, and after the product is done, the factory is torn apart and moved to another place, versus typical factories that create many products. So, a construction site is unique in a way that you can't just have an optimal construction environment for repeated products. You need to rebuild it again and again. That's part of the big challenge. So, what I seek on to the future is technologies that would provide better understanding of what's going on and give it to the professionals who run the sites.

And we need to know that building a construction site with a few buildings, each of them, you know, 50 or more stories or complicated fabs and hospitals, which are super technically complicated these days, these are very, very complex projects, and there are hardly any technology. Now, there's more and more technologies coming in, but hardly any technology that helps them do the right quality assurance of processes and other things. The more these things will come in, the better and cheaper the structures will be, or the construction will be currently. I've seen many estimates, but they're all of inefficiencies in construction sites. They're all in the realm of 30 to 35% of inefficiency. And you can think of 35% inefficiency in a construction site of one billion dollars. That's mind-blowing. It's both terrible and amazing in terms of opportunities. And I see many of those technologies trying to chip on that, solve parts of these 30-35% inefficiencies. And machine learning, of course, is part of it. It helps a lot with digesting data, but it's not just that. It's hardware, and monitoring devices, and so forth, which are also getting fairly cheap. Camera is nothing now. There's robots coming in, and drones technologies are heavily coming into play there as well.

Oleg

On a personal note, what drives your passion for making the world more efficient, and how does this passion manifest in both your professional and personal endeavors?

Eishay

Well, I'm an engineer in trade. Like, that's what I'm trained to. So, I guess many engineers are like-minded – they think about efficiency in different ways. So, it's probably more about genetics and how I grew up than anything else. I don't know what exactly. Yeah, maybe throughout my different parts of the career, if it's FinTech or Gmail, which is somehow drawn into this surface, yes, I'm, typically, I am looking for projects that have something to do with efficiency. And that's something I really like. It was in healthcare in the previous startup in Carbon Health. It was really all about efficiency and providing better healthcare and more affordable. And I think most of these challenges with industries that are too expensive to buy, like the value per cost ratio is not good. And it's really about the efficiency of that industry. You know, about my personal life, it's really about the day-to-day trying to get more efficient, being a father, and a husband, the CEO, and everything in between. There's hardly any time to do everything together. So, you need to design your life pretty well to get it done.

Oleg

Yeah. Pretty familiar for most of CEO. Are there any professionals or leaders in your network who inspire you in your professional journey?

Eishay

Many times I go back to Reid Hoffman in LinkedIn and Reed Hastings at Netflix. I was in their company not from the very beginning, but maybe a beginning plus when there was some traction, and I was very inspired. I'm still inspired by how they think and how they managed to get an improbable product back then to something that is very successful and maybe trivial to think of right now. From Reid Hoffman, I think it was mostly about, well, connection matters; people, culture matters a lot – something he was pretty adamant about. He had a saying that if you're launching something that you're not embarrassed about, you're launching it too late, means that it's okay to try, and it's okay to fail, just do it – a bit of a Nike approach. With Hastings, it was a lot about strong conviction and easy to change your mind. I remember talking about the new roadmap we had when the company just shifted to fully online, which was a disaster in the beginning. The stack, the stock just plummeted. Nobody believed that Netflix would ditch all of these CDs, DVDs that it sent via mail. It just won't work. But he was very strong in that in spite of all of market negative feedback, and he didn't change his mind few times here and there after he got the feedback. But all in all, he was very consistent about telling us that we have a strategy, and it's curved on a block of ice in the middle of the summer. Like, yes, it is a strategy. We thought a lot about it, and we know what we're doing, but we're willing to change our mind if we see that it doesn't work. So, that's kind of very two opposites coming into the same person same time somehow. Looks a bit paradoxical. It really inspired me.

Oleg

Great. These visionaries, people, they build history. Great to hear. You have had a diverse range of roles. How do you balance the technical aspects of your work with strategic and managerial responsibilities?

Eishay

I think it happened more in the beginning of my career as I grew up as a manager. I guess any trade, but especially engineers, they're trying to solve problems. Like, they see problems a team have, and they think, 'Oh, I've done that three or four times already. Let me fix it for you. Let me do it myself.' And I used to do it in the beginning. That was typically a mistake. So, the challenge for me is to let the past go, try to give them the space to do what they need to do, and really focus on my challenges. I would typically try to first do the things that I know best. But as a CEO, when you need to deal with finance, and with sales, or with customers, many different things, you know, they're not in my core competency. Like, I need to make sure I'm not neglecting them.So, the balance here is to try to focus on things that I'm not good at, that are not my forte. And, of course, if I have strong experience with product or engineering, it really help me to deal with those teams, and it's very easy to talk with them. The biggest challenge or the biggest balance that I'm trying to have is to keep on getting outside of my comfort zone and learning the things that I need to learn, versus staying in my comfort zone and just dealing with the things that are easy for me to fix.

Oleg

The accumulation of technical debt is more of a problem today than ever before. How do you approach managing and mitigating tech debt to ensure the long-term sustainability and scalability of technology solutions?

Eishay

That's a good question. Technical debt is indeed a huge problem. I mean, I don't think I've seen any company that doesn't have this problem, and it includes, you know, from the smallest startup to the biggest companies ever. Actually, the best situation is typically in a startup that is one year old – there is hardly any technical debt. A startup like ours, which is already five, six years old, definitely quite a bit of technical debt. I think, first, technical debt is okay. You need to manage it. I always think of it as, you know, if you want to buy a house, and you take a mortgage. You're getting into debt in order to create equity. And same is technical debt. You just need to make sure it doesn't kill you, and you leverage it to the best of your capabilities. One way that I did it in the past is tell the teams or the sprint teams that they should spend about 20% of their sprint on technical debt stuff. It typically doesn't work. It's a good idea, but it's very hard to get it done. The more successful way that I've seen doing, or I've practiced in the last three positions that I had and also here in Versatile, is to declare a I call it fix-it-week. The term is taken from Google. It means that there's one week every quarter that we're not doing any product work, and we're focusing only on technical debt. And there is about a couple of months of preparations towards that. There should be a technical lead. We should define exactly what. We should have a list of action items, basically, tickets in Jira, Asana, whatever you're using, and so very clear goals and things that are, you know, day or two kind of chunks that people can take off their plate. They take off and chew through.

Ideally, some healthy competition a bit, maybe announcing who could complete more or less of those things, and declare them, and give them something small. It's typically a good thing to do also for product that let them think about strategy for a bit and less about the day-to-day with engineering. I've seen that this actually works, especially if we tell the team that you must not, you cannot work on features those week unless there is special permission from the CEO, CTO, or somebody senior. And so, not just giving them permission to work on technical data, it's more about prohibiting them from working on anything else. Now, I've seen that once this is done, it's typically like there's a bit of carryover, and people are more used to, 'Okay, I did some technical debt. I can do it in the next few sprints. There's some things for me to finish up.' So, it starts to create a trend. One week, every quarter, that's about a month of a year. It's typically just the very bare minimum to chip on technical debt as you mature as a company. And so, there's still need to be more investment in it either.

Oleg

What advice would you give to someone who wants to future-proof software architecture to minimize the accumulation of technical debt over time?

Eishay

Minimalism. Try not to overgeneralize. There's a tendency, especially in people who are doing the first or second system, that do something that fits all scenarios, and it fits the long-term vision perfectly. And I mean, three, four years down the road. Some assumption about the unrealistic scale that we're going to hit, that's typically not working. It's typically very treacherous. It's like it's a swamp. You build something that's overgeneralized and use only a small part of it for the current feature needs, and the rest becomes technical debt because it's kind of overcomplicated. It's just you thought you need it, but you need something very different. It's almost always, as we get into the project and figure out you need to go a bit to the left or the right, it's not where you thought you would be coming.

When a company becomes healthy, it rewrites most of its core business logic every year and a half because it kind of iterates on it, it's a lot of iterations. And there's a lot of stuff that doesn't rewrite, but it's in the periphery, maybe things that nobody cares much about, and they can go stale on it. So, as long as you'll focus on the minimalistic infrastructure, you have to, and you know that you'll have to rewrite it when you'll scale. And it's okay that you'll rewrite it. I think you're in a good place.

Oleg

With headquarters in Los Altos, Boca Raton, and Tel Aviv, Versatile seems to have global presence. How do you navigate the challenges and opportunities of operating in multiple locations and cultures?

Eishay

It's definitely a challenge. And we have people in one, two, three, four, five different countries right now, used to have even six up to not too far ago. The key is over-communicating over Slack, for me at least. That's the way I approach it. Slack is great. I think it really boomed chat communication. WorthWork boomed in the COVID-19 era, though it was pretty prevalent even before that. So, moving to dedicated channels, communicating a lot, pushing the team to write documents, not too much, not overly, like not too heavy, but documents to communicate what they're about to do. Ideally, one or two pages. And I'm heavily using Google Docs with comments, and co-editing, and things like that. So, offline tools that are semi-online, like chat, they're kind of both offline and online. They really help. With those, we're having quite a lot of all-hands and team meetings, like it's at least once a month, and then smaller team meeting like that. Communicating a roadmap, which should be living and breathing with the team. So, having kind of a spreadsheet, something that you see as it moves around – it's key. And like, I know that we're on it and off it, and I would try to get back on it. And that's always a challenge, but it's really about the communication styles we have.

Oleg

Talent scarcity is a growing concern in many industries, including construction. How do you attract and retain top talent?

Eishay

That's definitely one of my biggest challenges, and I think it's true for everyone. There's so many smart people getting into tech these days – a lot of young talent and the older talent. And it's amazing to see. I think we do have more talent every year than the year before, but tech is growing even faster. So, overall, there's the deficit of talented engineers or tech people. Professionals is getting even deeper because of that gap. I don't have a good solution, unfortunately. I would love to have it. There's a balance of outsourcing and insourcing. Of course, different programs to help friends bring their friends into the company culture naturally is being radiant outside, so people are attracted to good cultures. So, you need to build, or I need to build strong culture in my company, both to retain the people, to be more efficient, and to attract people. But there's no magic bullet. It's all of the above sort of thing, just to try to optimize them all.

Oleg

Have you explored outsourcing as a strategy to augment workplace or address skill gaps? And what was your experience with this approach?

Eishay

I'm typically, I'm rather not to outsource and create more of a culture within the company that is like have people feeling more of stable stability and that they're one of the group, and they're culturally bonded together. It doesn't always work. Eventually, I do need to outsource for different reasons, either it's a first need, or just I need to move on, I just can't find the talent. So, outsourcing sometimes is the solution. When I do, I'm trying my best to have... Like, if outsource resources people, they're tightly working with the team in the company and trying to get them be together as much as possible. Together – I don't mean physically, more like involving them in conversations, and let them know what's going on, and have them feel like they're appreciated, they're part of the company. And for that, there is some legal restrictions sometimes of how close you can make them be part of the company. But I'm trying do my best to get them inside and to give them a hug that the kudos, and the appreciation, and everything else. We do have some areas where the outsourcing group are very loosely coupled with the main core business. And if that happens, I actually leave it as loose as possible in order to refine from creating a split brain, sort of situation where people feel like it's us and them. It's like, okay, if they're not working tightly with the rest of us, there's only one or two contact points, and they're dealing with whatever tasks they have to do. So, maybe the answer is either get them as much with the company as possible or as much as detached, not have a gray zone. Avoid the gray zone. You know, you are outsourced talents, so we treat you as a second-degree citizen, cause that's never good.

Oleg

How do you assess the risks and benefits associated with outsourcing, particularly in terms of maintaining control over sensitive information and ensuring compliance with relevant regulations and standards?

Eishay

I'm fortunate now that I'm not in a highly regulated industry. Like, for example, finance and healthcare, they have much more issues with regards to that. We don't face the same issues with regards to outsourcing people. We do need to be very mindful with GDPR about data security, of course, but more from a technical aspect, versus like which person is dealing with it. And of course, the contracts, and the NDA. And you know, we're SOC 2 and ESA compliant, so we do need to have everybody really understand what they're getting into and the confidentiality of that requirements. Other than that, we don't face it on a day to day.

Oleg

When evaluating potential IT outsourcing partners, what criteria do you consider essential, and how do you ensure alignment between your organization goals and the capabilities of the vendor?

Eishay

Our case, we want to make sure that it's not a project base, or the mindset is more of a team augmentation, versus a project-by-project. And like, here's a project deliver and move on. In my experience, it leads, or it lands itself many times to the project not being fully created with the mindset of long-term maintenance. Here's a project deliver, and move on. So, I'm insisting typically, on actual team integration. It's not a full integration because they're not employees like the rest of the team, but they do participate in one-on-ones, or sprint planning, or general Slack conversation to get things done. If it's a project deliverable, it's typically more operational. It's not like a product. It's more operation that people need to get done, as an outsource group. And that's less of a problem because that's a, you know, project is not something you need to maintain later. That's another mode of work where it's more like here's a team for you to work with, and they're not integrated. And that's fine, as long as it's not something that needs to be maintained later on.

Oleg

Okay. Thanks for the feedback. Finally, based on your experience with IT outsourcing, what advice would you offer to other companies considering this approach for their IT requirements? And what key considerations should they keep in mind to maximize the benefits and minimize the risks of outsourcing?

Eishay

That's pretty hard to give advice there. Each company is a snowflake. It really depends on your regulatory landscape. There's some things that you just can't do, of course, or you need to push the boundaries. Typically, I would say if it's a core business need, do not outsource it. You need to build it in-house. If it's something that the learning is fairly fast, and it's not something that is core, you may outsource it. If it's purely operational, for example, support or some manual data work, definitely outsource in those situations. Now, there could be some tools that you need to build, and that's about it, and very low maintenance after that, or you can maintain it later on in-house easily, that's also something I would say it's okay to outsource, and all the rest, like everything in between, I don't know. It really depends.

Oleg

Eishay, thanks for your time. Thanks for joining me. It was a great episode. Thanks for advices and sharing the information. I'm sure that many people will find it useful. Thanks for your time. If you enjoy our discussion and want to stay updated on future episodes, don't forget to subscribe and hit the notification bell. That way, you will not miss on the latest insights and conversations from Devico Breakfast Bar. See you in a week.