Back in 1982, John Naisbitt wrote in his best-selling book Megatrends, “we’re drowning in a sea of data, yet we’re starved for knowledge.” Thirty-five years later, we’re still swimming as fast as we can to keep our heads above water. As data proliferates, the need for better tools to analyze it has never been more important. Alteryx was initially created to help make analyzing data more accessible and useful. And that was only the beginning. Alteryx has blossomed to allow the “citizen data scientist” to bring meaningful results utilizing advanced analytics without the need to write or understand code.
“Alteryx is focused on taking on an otherwise boring, complex and sophisticated subject like analytics, and turning it into an opportunity to thrill people. For people using Excel to do complex work, Alteryx has worked very hard to take them from the end of their rope to the edge of their seat,” says Dean Stoecker, co-founder, Chairman and CEO of the Irvine, California-based firm that helps business analysts prep their data, allowing them to rely less on IT and data scientists. The publicly-traded company licenses the platform under a subscription-based (SaaS) model to its more 2,500 customers.
While Alteryx had a successful IPO in May of this year, the twenty-year old company has been around nearly as long as Naisbitt’s book. Stoecker and his two founders Olivia Duane Adams and Ned Harding, who are still a big part of the company today, decided they were going to be a pure software service and build the next great analytics company by developing a platform that would “liberate people from mundane data prep, and get them to the thinking stage faster,” says Stoecker.
Stoecker’s background in the data business taught him that anything that changes should be on a subscription basis, and analytics is constantly changing. That’s why the partners created a subscription model from the very beginning, even though it was hard in the early 2000s because the concept behind a software subscription service was so new. It took the meteoric rise of SaaS CRM company Salesforce to convince the corporate world that the SaaS model made sense.
“My career was built around content. I worked for content players like Nielsen, and Dun & Bradstreet, and people who sold data or attempted to monetize data in interesting ways. I always felt that the ultimate value in content is when it becomes ubiquitous, and that means by the nature of it, you have to have it available in software so people are able to apply analytics to it, so that data turns into knowledge, and knowledge into solutions,” says Stoecker.
The company was self-funded at the beginning. They received seed round funding through Thomson Reuters, but didn’t spend the money for 14 years, which is quite the opposite approach of what you would find in Silicon Valley today where it’s speed, and capital burn.
“We had slow growth, adding eight or nine customers a quarter, charging onerous fees for our platform, going at high value use cases, and then we saw the market for self-service open up where people were frustrated with IT. They were in Excel hell, hating their jobs. Then we started just knocking it out of the park,” says Stoecker.
At the outset, Stoecker thought raising money was a sign of weakness and ran the business conservatively for profitable growth. Yet to stay competitive and to accelerate expansion, the company raised $163 million dollars in venture from 2011 to 2015, leading up their IPO.
“Patience becomes a real virtue in leadership, and entrepreneurship. Many people go out and raise a bunch of money, and build something, and then think people are just going to show up at your door, and the reality is we waited until we heard somebody say we needed more capability and fewer tools, and we literally took all of our APIs and integrated them into the user interface as we know it today. I learned a lot of lessons about patience, discipline, courage, and knowing when to cry uncle from my father,” says Stoecker.
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