- App Annie, the $468 million mobile app data analytics startup, is preparing to be IPO-ready, making a play at M&A, private equity or going public in the next two to three years, says Ted Krantz, CEO of App Annie.
- App Annie, which is often cited in Apple‘s announcements, has grown quickly, but the biggest challenge has been the company culture, Krantz says.
- Krantz explains how the company worked to revamp its culture and raise employee engagement in the past few months.
Before taking the reins as CEO of App Annie in July, Ted Krantz recalls the awkward silence in the room during all-hands meetings.
Employees would sit uncomfortably while executives or managers made presentations, he recalls. No one would ask questions.
“None of us were feeling too great, and that’s inclusive of myself,” Krantz said. “We were losing the engagement of our employees.”
That was a wake up call that the company, one of the biggest players in the mobile app data analytics space, needed to change. Employees felt like their voices weren’t being heard, and Glassdoor reviews plunged. App Annie embarked on a major reinvention that brought in new executives, replaced old practices, increased company transparency and helped its employees become more involved.
Krantz spoke with Business Insider about how App Annie, the fast-growing $468 million app platform that is often cited in Apple’s announcements, revitalized its culture from the inside out. It’s a work in progress, but he says the positive results are already making a difference.
The cultural turnaround inside App Annie has been one of the company’s top priorities that Krantz hopes will put it on solid footing for the next stage, as it moves closer to a possible IPO in the next two to three years.
“We want to move to the next chapter and move to the next level and focus on innovation, talent and culture,” Krantz said.
“They were not feeling like they have a voice”
Last year, App Annie started seeking a new CEO to replace former CEO and co-founder Bertrand Schmitt because it needed to scale. Schmitt was very much involved in the process of transitioning a new CEO, and he still plays a role in helping the company grow.
Krantz, who had already been serving as App Annie‘s president and brought in a background of working at Oracle and SAP, was a natural pick. The company desperately needed culture changes, Krantz said.
Successive rounds of layoffs had taken a toll on morale. Although necessary for the company to be more efficient, Krantz said that the cuts put the employee base through “torture” since the company didn’t do it the right way the first time, and it ended up being the biggest source of employee dissatisfaction.
“They were not feeling like they have a voice and confused that perhaps what they’re hearing is some orientation of spin-selling,” Krantz said. “There’s something behind this that isn’t good.”
“We’ve been a bit naive with assuming they’re all right when they’re silent”
Krantz had previously worked with SAP CEO Bill McDermott, and he cites McDermott as an inspiration. That company, he said, was known for being a stale corporation, but it made a major culture turnaround and ended up winning a Glassdoor award.
Krantz wanted App Annie to make that turnaround as well. He started with a new company focus on transparency by giving employees the straight-up facts and numbers and allowing employees to draw their own conclusions from the insights.
He worked on describing the company vision in a clearer way to employees and posted its key performance indicators across the company — something the company wasn’t doing before and which may have caused some of the mistrust, Krantz said.
The change in attitude needed to happen at all levels. Instead of denying or brushing off employee feedback, the executive team made sure to respond to employees. Management now organizes meetings to be more town hall style, rather than bombarding employees with slideshow presentations, and they focus on talking to employees, rather than talking at them.
“I do think the listening is key,” Krantz said. “That’s been a big takeaway for me. We’ve been a bit naive with assuming they’re all right when they’re silent but it’s the opposite…Before, there was no listening. It was more of, ‘here’s what we’re going to do. Here’s why. Are you guys excited? No questions? OK, let’s go.'”
App Annie also started focusing more on career development opportunities for its employees and having managers ask their employees what their goals are. Krantz said this helped with retention as employees felt like they were being heard and there was room for growth.
“We encourage having 1-on-1’s across the organization and try to be sensitive to that especially with our top performers,” Krantz said.
Now that team members are more aware of the roadmap ahead, the company can focus on product innovation. In November, the company launched App Annie Labs, an initiative to accelerate product development by partnering closely with customers and getting their feedback. And App Annie expects a release this coming quarter.
“It’s the first big new product offering since I’ve been on the company,” Krantz said. “Everyone’s getting a pulse to get things moving. Right now, more differentiation than they’ve had in the last three to four years.”
The roadmap ahead
The internal improvements also mean the company is now better equipped to look ahead to the next big milestones. An IPO is possible, but Krantz says it’s not the only option. In the next 18 to 36 months, he says, AppAnnie will “make a play” at either a public offering, an acquisition or a private equity deal.
“I’m not obsessed with an IPO, nor is the board,” Krantz told Business Insider. “The dynamics have changed…where it used to be, the gold star is IPO, the second prize is the other options. I don’t think it’s that way anymore. We want to be in a position where we’re growing the company responsibly.”
Although App Annie has made progress, Krantz says there’s still work to be done, and he probably won’t start feeling good about the culture until 2020.
“Culture has definitely been the biggest challenge,” Krantz said. “It’s hard to turn the tide. We put so much work, energy and effort into it where I feel like it’s stabilized. We get signs we’re moving into a green zone, but you don’t want to get so excited.”
So how are the meetings now? “Now it’s a completely different reality,” Krantz said. “We have to extend all-hands and the questions go on for an hour…It’s based on trust and an open dialogue. The thing that’s interesting to watch is the boldness of the questions and the challenges that they place.”
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