Using Tech to Solve Its Biggest Problem | Shay David from Retrain.ai

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Shay David 0:00
Every business line manager and every CEO in the world, wake up we’re going to two key questions. Question number one is how we’re going to build good products and services and sell them for a lot of money. And question number two is where the hell are we going to get the people to do number one?

Alexander Ferguson 0:23
Welcome to UpTech Report. This is our founders journey series UpTech Report is sponsored by TeraLeap. Learn how to leverage the power of video at Teraleap.io. This is actually a continuation part two of our discussion, very excited to have my guest Shay David who’s based in United Kingdom, he’s the CEO and co founder at Retrain.ai. Good to have you on man.

Shay David 0:45
Thank you, great to be here.

Alexander Ferguson 0:46
Now, this retrained AI is a talent management platform for enterprise and government agencies. It focused on helping assess workforce knowledge, qualifications and skills using AI machine learning. Help retrain them, recruit and retain, go back and listen to part one of our discussion to hear more about the product itself. But I would love to hear the journey that you’ve been on of how you got to this point, this is not your first venture. Take me back as far back as you want to go. Why are you here today?

Shay David 1:18
Thank you well as we’re gonna go down the memory lane here. But but maybe I’ll tell you about my previous venture of what kind of my last row before I returned before starting return AI together with co founders. Obviously more than Isabel better yourself. Before the three of us got together to solve this problem, I was actually involved in another venture, a company called cultura in culture as a leader in enterprise video. And actually, I’m not gonna be able to shoot too much data about controller because controller is in the process of going public controller actually filed its s one registration statement recently. So I’m not going to be able to talk about any of the details, but anybody who’s interested can read about it, and the SE C’s website. But cultra was a very interesting journey that taught me a lot and allowed me to really refocus on a new venture and retrain AI. And one of the things that we learned that culture and culture, I was one of the four co founders, initially the company’s first CTO, then for most of my tenure, the chief revenue officer, and in my last day job is cateura. I was the GM for media and Telecom, one of the two business units of the company. And one of the things that I learned at kultura why we were selling enterprise video systems is that culture never really focused on the content itself. culture was more really focused on the, on the technology. And that was left me with some questions about what are people using the video technology for. And we learned a culture that video was becoming a very important part of the fabric of enterprise communication and collaboration, of median entertainment of learning and development. Basically, people are very visual creatures. And culture, we saw that every process could benefit from video or the video ification of existing services was very significant video had the potential to change the way we study, the way we meet people, the way we work, the way we collaborate, the way we communicate, etc. One of the things that always struck me as very significant was how people come together to work. And many of the cultural users were actually using culture for learning and training, learning and development, enterprise communication, and through a lot of conversations with a lot of culture customers. I learned that this learning and development was really becoming a very significant use case. So I’ve had the pleasure of traveling a lot around the world meeting with a lot of customers. And one of the things that always came up in conversation was how hard it was for organizations to find the right people for the job.

Alexander Ferguson 4:04
And video was insights are coming together of already forming the basis of what return Exactly.

Shay David 4:09
And in that sense, video was one solution that people were using to find talent, and to train talent and to train and upskill. And in my mind, there was always kind of thought lingering, saying, Wow, this seems like a really big problem for organizations. And as I was traveling a lot around the world, for my job as the CFO for the company, I would travel over 100 days a year, meeting with clients in every continent, and making business connections making friends. The one thing that struck me was that every business line manager and every CEO in the world, wake up we’re gonna have two key questions. Question number one is how we’re going to build good products and services and sell them for a lot of money. And question number two is where the hell are We’re gonna get the people to do number one, a good product idea, but you need the people to build it and make it happen. Exactly. And as I was looking at that, and kind of looking for the next big idea, that struck me as a really worthy, worthy cause. And particularly because it seemed as if the skills that are necessary to participate in the modern economy are not distributed equally. And the more I learned about this problem, the more I saw that the skills gap problem is not only a big problem today, but the problem is worsening. And a lot of people that can really participate in the economy, as we know, there are a lot of people that are losing their jobs, a lot organizations that are struggling to find talent. So how could it be that on one hand, we have too many people? On the other hand, we don’t have enough people? The answer is, it’s clear in the sense that the skills gap probably keeps growing. So that was the basis of return AI.

Alexander Ferguson 5:57
Now, looking back at your history, and I tend to be fairly informal on these interviews, but your eye doctor david, because you’ve got your doctor, you have this this knowledge right out of Cornell University, right and Yale. Your first organization I saw is destinate. Are technologies. Is that correct? If that was Yeah, so

Shay David 6:18
destiny, destiny was another interesting, very different company destiny was started by myself together with my good friend, Ronnie ptl, who was later the founder, Chairman, CEO of interested today, to run I go way back. And we actually met it, believe it or not in high school in Palo Alto, many, many years ago, three years ago. No, I wouldn’t tell you how much because you could guess my age. But detonator was a GPS navigation company where the challenge that we were solving then, was the challenge of getting enough data on a mobile device. This is before we had 5g and 4g and 2g and 3g and web. Back when the mobile computing meant palm pilots and complicated acts, the challenge was getting enough data on a mobile device today, when we have electric vehicles, people have range anxiety, because they think that they might run out of battery. Back in the day when we talked about range anxiety, people thought they would fall off the map, you know, you needed to get enough metric data on a device for applications like onboard navigation or fleet tracking, and definitely developed a series of technologies for map compression, for fleet tracking, for onboard navigation that allowed people to basically enjoy the benefit of kind of a full scale, GPS navigation system, while having all the data on port,

Alexander Ferguson 7:48
what was the the destination that defines the outcome of that business?

Shay David 7:56
Yeah, that’s an inner was merged into a public company, on the NASDAQ. And then later, when the stock prices became attractive with the.com crash, it was actually acquired by a private equity firm by first by a Canadian Corporation then by private equity firm. So that outcome, yeah, and after that articulate break, and I went to academia, and I went to go get my PhD at Cornell, where I studied open information systems in science and technology studies. And I was very interested in understanding how open information systems work. In order to make it manageable, I decided to only study what people do if it began with the letter C. So I looked at the way I’m just kidding, of course, but I looked at the way that large groups of people come in and communicate, collaborate, cooperate, create a sense of community, as they’re building large scale information systems. So looked at systems like Wikipedia, in open source software, but then started looking at other domains completely like military intelligence and open source biology. And it turns out that there are many examples both in history and in contemporary development, where there are different modes of development, which is not hierarchical fears, are not price based signaling, but rather communities of developers that are coming together in open information systems. So I developed a theory to help explain how can these systems work? And there was there was a lot of

Alexander Ferguson 9:32
the between these three organizations have retrained on a being your your third one. You brought several products to market being able to bring it to light, what would you say are some lessons learned or methods that you found that work well to get the time to market down and be able to deliver something that really adds value?

Shay David 9:51
I think I think it goes to two main principles. One I would call customer centricity and the second is data centricity. customer centricity. I think pretty straightforward, focus on customer value. don’t develop anything just because it’s easy to develop or because you think it’s cool or because nobody did it before or because you have this algorithm that nobody saw, right? focus on creating real world value for real world customer. And that is absolutely fundamental right? Many companies fail because they develop technology for technology’s sake. In my view, it should always be customer driven, take your reward problem of a reward customer, hopefully, customers are willing to pay you some license fees. But even if that’s not even clear of how much they’re willing to pay, or are they willing to pay, create reward, value, reward usage, solve a real world problem, and really, really, really focused on the customer. Every discussion in the r&d organization in the marketing and the sales in the DNA department should focus about customer value, invest your next door, we’re going to hire another programmer, we’re going to do another marketing campaign, or we’re going to buy another server or whatever it is that we want to do in terms of capital allocation is this next dollar going to create customer value or not, and every donor should. So that’s Principle number one customer is interested Principle number two, is data centricity, which is apply that both to Principle number one, but to anything else that you do, which is use the data to take your decisions, right? That doesn’t mean that you can’t use hunches and intuition, and conviction, because you should use all of those. But at the end of the day, you should really have data to back up your decisions, right. And if you’re not sure about which of these two new features is going to create more customer value, then go and check it out in the real world, bring the data and use that data to validate you’re not sure which marketing campaign works better bring the data, you’re not sure which of your new to sales hires better than use the data. So every single organization should be very data driven. And that makes a real big difference in their organization’s capacity to both develop product market fit, but more importantly, to scale later.

Alexander Ferguson 12:13
I really appreciate both of those those values and mindsets. First one making sure that you’re you’re focused on the end customer bringing value and I never thought about applying it to your hire your next dollar were you spending will that hire will what you’re spending money on bring more customer value or is it for something else and the second data centricity. It’s okay to have hunches. But don’t do it in a vacuum. Make sure you’re having data around you to make more educated decisions head switch, retrain, that is all around is building the right data set. Now team being a core component of being able to make that happen, actually, for retrain it How big is the team today?

Shay David 12:49
In return, we have about 25 people on the team today. So I’m in the US. I’m in London, most of them until Aviv. And very importantly, we have also our ancillary r&d Center in the Palestinian territories in Nablus. So we believe that the talent exists everywhere. And many companies go and have offshore operations in Bangalore or in Kiev. And we decided that we can stay closer to our main r&d Center in Tel Aviv, and be able to offer some Israeli Palestinian cooperation along the way.

Alexander Ferguson 13:22
In whoever you’re hiring, obviously, making sure you’re making the right hires doesn’t matter where they are. So the right people, what was one of the first one or two people that you did hire and are crucial hires that you would also recommend others to make?

Shay David 13:38
Yeah, so the first the first thing is to make sure that the founding team is well rounded. And I was very lucky to have good friends and colleagues in his opinion in Avi, we have, I think, a very well rounded team and very good division of labor. So is a bit is our chief operating officer. She oversees operation phase marketing, and basically is helping on on anything that has to do with customers, investors, kind of she’s our foreign secretary, if you will. And Avi, their CTO is a very senior technologist with many, many years of experience building large scale systems with many years of experience in in countries scale systems for Israeli Defense Forces, and is leading our entire technical development efforts including r&d research, production, operations, etc. So the first order of business I think, for any startup is to make sure that the founding team is very, very solid, because if you missing core competencies in your founding team, it will directly relate to the fact that you need to hire for those really, really quickly. So that would be my first advice. Make sure that either you get co founders that completely complement your skills, and if not, be aware of that. I understand that you need to hire immediately for that, that would be my first step. The second is, I think that as you’re starting to hire kind of for VP level and whatnot, think about the organization is an organism, right? You can’t just advance one side of it, without advancing the rest of it, like any organism needs to grow its entire body kerbin parlent. And I really think that that’s important to recognize that organizations grow organically, in a very typical mistake of many startups is they say, well, the product is not fully done yet. So all we got to do is hire programmers, you know, we’re only going to hire for technical talent. And then we’re going to develop the product, and it’s going to have abilities that we can approach. Some organizations could get away with it, that’s actually quite rare. You know, some some teams have such great product vision is such compelling products that they build it and people come in, sometimes that happens, that is an anomaly is its exception to the rule. In the very large majority of the cases, in parallel to developing the product, you actually need to develop the market. So my recommendation is always, when you hire the first few programmers, you also need to hire for business development for sales for marketing. So you can start telling your story. And the if you bought the principle I was discussing earlier about customer centricity you have to have in your organization from day one, people that are customer focused, otherwise, it becomes kind of a navel gazing operation, you have brilliant technical people. And they all develop brilliant products that have not enough connection to the market. Or at least that’s the risk. So my recommendation is hire in a well rounded approach for technical roles for sales for marketing’s for operations, all in parallel. And don’t be tempted to just develop the technical side of the organization, while neglecting the other sides.

Alexander Ferguson 17:03
And what I find fascinating is that you come from the technical side is as as being more diverse on VP of r&d and your fellowship, but you see the value of a well rounded organization to

Shay David 17:15
Yeah, and I think that I’ve gotten that appreciation through a move back and forth between the technology side, and the revenue and customer said multiple times in my career. Because at the end of the day, again, strong conviction that we’re not developing technology for technology’s sake, this is all about creating customer value. And in the first few years of the technical product development, clearly the weight lies in the technical development, if you don’t have the product, you have nothing to sell, you can’t really, you know, maybe other projects exist. But we’re talking here about kind of tech focused startups, that technology is the most important things, there’s no question about it, right. But it is only the most important thing in the sense that you have a clear sense of how you’re going to provide the customer value. And in that sense, you need to be able to hire for that in parallel and take the, the plants to spend the money. Make sure that you’re doing that and developing kind of the organization of muscles, if you will, to be able to develop those products.

Alexander Ferguson 18:13
The the team is wanting, making sure you have the right team and then and the product has the right fit, right. But then to get clients, customers, it’s kind of a big piece, you wrote two parts, right? You had mentioned earlier, you focused also on the culture, the b2b space. So you know this intimately, what would you say is some of the key takeaways that you have found in order to create proper b2b relations and, and sales to be able to scale?

Shay David 18:41
So So first, I think the first thing is that you have to understand the difference between kind of b2b and b2c and some people still are confused about that. I think an app metaphor is a b2c is like lightning strike. b2b is like building an electric utility, right? b2c can capture all the sparks and be very shiny, but it’s very rare. And you might get burned really bad, right, versus if you’re building an electric utility, it might be unglamorous work that takes many years. But over time, that’s the real way to create lasting enterprise value, if you look at the company’s largest organizations, and they all have a very meaningful kind of enterprise components. And again, of course, some of them like Facebook, or Google eventually are mostly focused on on consumer technology, but very strong enterprise grade technology behind it. And the thing that’s very important, I think that the, the key to success in enterprises, goes back to this principle of customer value, but understanding that that customer value is reliant on making the technology consumable by the enterprise. And what that means is that it needs to be reliable, and it’s to be cost effective. And it’s to be secure. And it’s to be clearly used. And it needs to provide value for their end customers. So oftentimes, when we think about b2b says many of the use cases, process control and return actually not just pure b2b, but b2b, b2c, or we call the b2b to E, business to business to employee, we want to provide value to that consumer the end. And what I always told her tech teams and consistent is never forget the C, right, it’s not just b2b to b2c, or b2b to E, never forget the consumer, at the end, never forget the employee, then never forget the student at the end was going to use this systems. So I think that’s that that’s very significant. And also you develop over time and appreciation of how enterprises consume b2b technology, then sometimes it’s not that next shiny object is not a feature function discussion. But it’s a scale function, reliability function, security function, that are the most determinant and capability of a technology to grow within the organization. Because if you’ve missing those fundamentals, that’s just not going to scale, people aren’t going to use it because it’s shiny, and then the next shiny object comes along. They’re going to throw your technology, and you’re going to have big churn. So I think those are some of the key principles you have to focus on.

Alexander Ferguson 21:29
Are you as a leader? How, where have you gone to get good insights, any books, audio books, podcasts that you would recommend to other leaders?

Shay David 21:39
For sure, so first of all, for anybody interested in kind of future work stuff, I would absolutely recommend card phrase, book, the technology trap. He talks about Carl, the head of the future work Institute at Oxford, one of the thought leaders within that space makes a very compelling comparison between kind of the first industrial revolution and our current Fourth Industrial Revolution and talks about the ways that technology could be fought for good, but could be quite devastating if it’s not used in the proper way. So that is definitely something that I would recommend. And I like that a lot. I think that for people that are interested in larger questions of how technology relate to society, and I think Russell Brand’s podcast is phenomenal. And he has some phenomenal guests on that show. And I think that for people that are really interested again in issues of technology in society, I think that there you’ve all know Harare, some brilliant writing, and particularly his last book 21 questions for 21st century is, I think a must read for anybody interested in the future of AI, the future work the future of how technology really relates to society, the role of enterprises within society. Yuval talks about those from Canada history and economic history perspective.

Alexander Ferguson 23:10
I have now a nice reading list. To be able to get into thank you so much for sharing your journey, the insights that you’ve had here. It’s been great to have you on the show.

Shay David 23:22
It’s really a pleasure to be here. And thanks for inviting me. And, again, anybody that has more questions or wants to learn more, you can find me on Retrain.ai and happy to connect

Alexander Ferguson 23:34
You hear that again, Retrain.ai. Also go back and listen to Part one where we dove in and understood a bit more about what they’re building. This was our founders journey series. We’ll see you on the next episode of UpTech Report. That concludes the audio version of this episode. To see the original and more visit our UpTech Report YouTube channel. If you know a tech company, we should interview you can nominate them at UpTech report.com. Or if you just prefer to listen, make sure you’re subscribed to this series on Apple podcasts, Spotify or your favorite podcasting app.