Understand First, Disrupt Next

Matt Perez (00:04):

Well, hello welcome to rHatchery live. We have some noise, and we're interviewing Guillermo, Espinola, Guillermo is the Co-Founder of a company called Xipe a is a software services company in Hermosillo, Mexico. And we're going to be asking him about his topic primarily, which is to understand first and disrupt next. And I can vouch for the fact that he's disruptive. And with that, when I ask you Guillermo to introduce yourself.

Guillermo Espinola (00:50):

Okay. Thank you, Matt. Thank you, Jose, for inviting me to this live. Well, what is said about me? I am a software engineer and a developer by myself. And back in 2018, I started the company Xipe with the vision of helping entrepreneurs to create software differently, more aligned to their purpose and a little bit less in the technique. So, about this topic of disruption is because the software industry is full of messages and noise about what disruption is. And so sometimes I feel that the} meaning of the word is lost.

Matt Perez (01:40):

So, what do you mean by the word disruption?

Guillermo Espinola (01:45):

Okay. Disruptive is what it is. It's a deep change in an area and an industry. But the thing is not what it is, it's what really matters is how did you achieve to disrupt an industry. And sometimes we speak about disruption, very light in a very light way. And what I want to, what we are aiming to solve in this part is to help entrepreneurs to find what they need to identify where the disruption opportunity, because you can say they will disrupt a whole industry. It is complicated because industries are not a monolith. They have pieces and they have a mobile part and part that you can't move. So, disruption implies to move that parts that are not movable or we think that are not movable. So that's how we started developing software in a way more oriented to the purpose and less thinking on the thing as you said on the material conditions of the industry.

Matt Perez (03:22):

Okay. And, so give us an example of what you're doing about disruption, things like that. If you're working with anybody that's disrupting a particular area or, I know you, and I as well, and I know you guys are doing a lot of really interesting things and but give us an example of what you're.

Guillermo Espinola (03:50):

For example, this is a story I will not say many details of the customer, but we receive a customer that said, “okay, I want to change the way people engage with the gym”, the health industry. I want to change the way gyms engage with customers, and we need to be disruptive. And how do you want to be disruptive? We want to be the uber of the gyms. Okay, well, Uber already exists, so it's hard to disrupt with something that already exist because it becomes the new mainstream and everybody is doing it, and there are a lot of followers doing it. So, eh, we need to start understanding what part of the gym industry are you in, and what do you think that must to change? And well, that question seems very easy, at the beginning, but like, okay, no, I want to create a membership system. Okay, just, but how, how that will disrupt. So tell me more. And then we discover that, to be honest, nobody in that team, in the company and in our end, we nobody knows how to disrupt this, the gym industry. So we start questioning ourself, okay, what do we need to change and why? And does the people need it and how to help? And suddenly, the pandemics strike, and that industry was very affected by the pandemic. Nobody can join the gyms anymore. And then when they reopened, they had limited occupation and things like that. So, we start creating small pieces of software, firstly isolated to solve different needs, for example, okay, how to manage the reservations in a limited room. And then how to stream the classes and the training and the relationship and how to keep active, the relationship with their coaches and what can they sell in addition to the membership that now that the people have no access to their well, that become something very interesting because of their three years. What we see is that the engagement of this club with the people has grown, be beyond their geographical limitations. And that's very unlikely in a gym. So right now they are opening a lot of like popup stations in different cities, just because people requested, “Hey, we are here in Mexico City”, or another place, and they move people over there, create a bootcamp, create a training, and if the community grows they establish in that city. And that's something that is a growth model never seen before.

Jose Leal (07:17):

Guillermo, can I ask you a question?

Guillermo Espinola (07:19):

Yes.

Jose Leal (07:21):

It sounds like what you're describing is your relationship with your clients. How do you help your clients with their demand for disruption? Right? And, and so the question I have to you is, can you help your clients with their desire to disrupt if yourself haven't disrupted, how you do your work?

Guillermo Espinola (07:48):

Okay. The relationship is not all sweet. We have a lot of ideas, confrontation, which means that sometimes we are not aligned with the purpose of the customer, or sometimes some ideas of the customer are not aligned with their purpose, because that happens. So there's where the friction start. So, but in a framework or of respect and I don't know, security to be yourself and express what your ideas and to if you know that the other part is hearing to you that everything we can overcome, that friction and there is where we start creating that disruption. And regarding if I need to be disruptive to help, to disrupt I don't know. I think we have made some small disruptions inside our company first to change the way we see what we do. Because software development is not about software development. It's about the problem that we are solving. But what I think is we have enough experience to guide our customers into identifying which small parts of their business can they disrupt. Because as companies are organizations and organizations are made by people and are formed by people. So, we need to change the way we do things inside, and then we will impact in the, in the market or, I don't know, with our customers. So I think that's how we lead our customers to disrupt starting by challenging their own, their own rules. Then we help them or try to make them see that the corporate world sometimes is efficient to keep something going, but it's not the most efficient thing to create something new. So there is a process of unlearning how to organize your team. So we start over there almost always.

Matt Perez (10:16):

So, what have you done? You mentioned in the passing that you changed the way that site operated or something. Can you tell us more about that and how it was, how it is and what the change is and all that?

Guillermo Espinola (10:31):

Yes. We started the company as an offshoring company. So we receive requirements and we deliver software. And then we learned that that model doesn’t create that engagement or ownership with the developers under code. So, the boxes start accumulating and then you fix something and break another thing, and it becomes unsustainable. So, learning from companies like yours, Matt, we moved to the dedicated team model, but then we discovered that making a team is a full package. Is not only recruitment, our recruitment process, we're just putting people together. We are trying to create a team since the recruitment model. So we changed the way we recruit. Instead of having a big pipeline of developers passing the stages, we try to put the candidates together, try to create engagement in that meeting, trying to see who is collaborating with whom. And if we, if we detect some synergy between some of them, we try to get them together. So, we are changing the way we recruit, we're recruiting because also the best developers in the world, the best talent in the world, they are not aimed, they don't like to be six months in a process when a conversation with a coffee can be enough to detect their skills and their commitment and their triggers and what they are looking for. So we are trying to make the process shorter and more focus on their career plan, not on their skills, not about their skills. And well, I think that triggers a lot of small changes in our process.

Matt Perez (12:29):

Okay. And what did it do for you?

Guillermo Espinola (12:33):

Sorry?

Matt Perez (12:35):

What did it do for you personally? What impact did he have?

Guillermo Espinola (12:40):

Okay. I feel more free because I can connect with the team as much as possible. The idea of having pipelines for everything and I making everything like a process in like industrial process, disconnect people. So, in the previous version of my company, I feel like trapped. And at some point I said, okay, why? This is my company and I don't feel excited about it. So, after a lot of thinking and speaking with people and sharing experiences, I think I found that what was happening I was disconnected from the development from the team. And I like to code. I still like to code. So, I start involving in the coding, participating with the team, and then the traction changes a lot, because I think sometimes companies start treating people like resources instead of team members. So we stop that and I feel very happier now.

Jose Leal (14:02):

Why do you think, like, what conceptually for you, what is it that is, I mean, you've described the pipeline and all of this sort of structured process. What do you still have to do as far as the transition? That sounds like you're going through a transition. What's still left for you as you see it today?

Guillermo Espinola (14:30):

Okay, I think I need to okay, there are a lot of things in the development process that we are still managing as a pipeline because it's the most accurate or the most common process in the industry. But I think that something that it will be interesting is too flat to completely the organization, because I have partners that are not involved in the operation, but they feel like strange people for the team and the team feel and they want to make them closer. The idea of having a partner in the far away is of the company. It doesn't work. And maybe it's not a problem, but it doesn’t feel like natural, and I want to create this company. I want to make this company more natural every day attending to the needs of the, my partners, of my team, my own needs, my own natural needs as a person that are investing my time in something to achieve my goals I want to change the way we see companies. They are not their gold. We are not the developers. We're people right now, we are developing software in this company, investing our time. And if we all can align and see the company as a vehicle instead of an end or a thing that can possess or I don't know, how to say it properly, maybe, but.

Jose Leal (16:20):

You just said something that really intrigued me because it's like you've got a need of a client, a need of you, a need of the team, a need of a specific individual contributor. And what you're trying to do is meet all those needs. So, what do you think the needs a say of a developer are that would be an alignment with you in alignment with the organization in an alignment with the client's needs?

Guillermo Espinola (16:57):

Okay. I think this is the best analogy that I found like a train or a subway or something like that. The customer needs to arrive at some point. The customer wants to arrive at some point in this relationship. The developer that arrives at this strain. They want to learn; they want to improve their skills. They want to gain experience, obviously a, salary an economy safety.

Jose Leal (17:31):

Economic safety.

Guillermo Espinola (17:32):

Economic safety, yes. And a growth plan. Everybody has dreams. So, if we are following the analogy of the, and myself as well, I think it's the same motivation. So, when we have a destination, we can jump into the train, and everybody can play. Its role in that train. Well, the companies are those trains, and the destinations are the purpose that we are doing. So, if we align the developers and the team and my company, all the people involved with the customer, with their purpose, so we are going in the same destination, but as I said, this is a train you can set, okay. Beyond that point, I am far from where I'm going. So, I will get down here and people can leave the company and can join the company later customers as well. But in the way we align more of interest and more of our purposes the longer will be the right together. So, it's how I see it. And that's why we are looking something called like well, we call it like, we're finding for companies doing software for good, because if they are working in something that we consider good will be easier for us to align with their purpose and better the so that we will deliver.

Jose Leal (19:06):

It's easier to get on train that's going where you want to go. Then it is to get on a train that's going the other direction.

Guillermo Espinola (19:14):

Exactly. That's how I see it. And that's how I think all those interests get aligned.

Jose Leal (19:23):

So, is it fair to say that your goal isn't necessarily a, how many clients do we have and how big is our revenues? And are we going to double our revenues next year? Or how many clients, and I'm asking a question, not making a statement how many of our clients are on the train or how many of us like the train that our clients have? Is that the kind of conversation you guys have?

Guillermo Espinola (19:52):

Actually, when we start all these revolutions at the company, against the corporate way we used to work, we lose customers. We need to let them go because our trains start going to another part and we are not making, we weren’t feeding anymore. So, it's exactly the kind of conversation that we have with our existing customers and with the new ones or the people interested in collaborating with us.

Jose Leal (20:31):

Matt, did you want to jump in.

Matt Perez (20:36):

No, go, go ahead. It is a very interesting conversation the way you're taking it. I like the model of the train going in certain directions and the right is long, but people jump in and out as they need to both the, you know, people that work there and contribute there and people that get the benefit of that, your clients. So that's a very interesting model in general. So, in terms of the future, what are you doing? What do you think or what do you plan for the future? What's going to be different? What's going to make you more the way you are and more happier and have people happier and stuff like that?

Guillermo Espinola (21:28):

Well, I think the future, the tends to a more free working environment. People no longer want to be their doctor. They engineer. They want to be themselves and do what they want. So that freedom is something that we are encouraging right now. How to make people feel that they are part of a company.

Jose Leal (21:59):

Is it about making people feel or letting people feel.

Guillermo Espinola (22:04):

Letting people feel, yes, you're right. It's like, I will force you to feel. No, let them feel that they are part of this company, even when we are maybe disagreeing with some topic. And they need to be safe, secure, confident enough to express their ideas and without fearing losing their jobs. So, the future of work is of, all the work environment is freedom. We need to forget about those systems that keep people track overview over what, and instead of that, start focusing on the outcome of the people's work. What this person is doing for my company, not how many hours is working, is what is giving us that is I don't know the outcome. How this person is impacting our company. Is it valuable or not? Are we valuable to him or to her or not? So, I think that will be the relationships in the future between people.

Jose Leal (23:19):

So, I'm hearing that you think that the new currency is about contribution. Yes. Is that a fair way to say that?

Guillermo Espinola (23:27):

Yes. Completely is. And we have that in the open-source model, many people contribute to software because they believe in that and they create interesting business models and they create also wealthy companies, but everybody works in freedom. So, I think we need to challenge the corporate world and well proof that that model is actually faster and reliable. There is a meat right now, maybe it was true years ago, because they said vertical organizations grow faster, horizontally, organizations grow slower, but they are more like stable. Well, I think that maybe was true 20 years ago, but right now, with all the technology that allows people to connect not only through a through a trunk or a spine, now they can connect everyone with everyone like notes. And if the purpose is clear if the purpose of the organization is clear and it fits to your own purpose, or while it fits to your own purpose, then the work will be faster the productivity will grow. All those topics that, that the average industry claims to, to solve, okay, are solved with this model of contributions, and we don't need to be speaking about it. This, it's for granted happy people work better, deliver better. That's how I see it.

Matt Perez (25:16):

And not only that, but right. You know, to add my part, I think that people feel better as well, would like to work the can environment better. But that's, I was going to say, that's to be seen, but not really. It is a fact that when people are doing well and all the pistons are going up and down the right way and stuff like that, they just feel better and do better work.

Jose Leal (25:51):

So, I wonder if we can loop back to the topic that you talked about, which is, you know, you have this idea that if we understand where we're going, then we can actually do disruption. You are now understanding better what you need, what your team needs. They understand what they need better, and you're starting to understand what your clients need better. Is that a fair statement?

Guillermo Espinola (26:29):

It is a fair statement. I think it's to be a little bit more humble and instead of arrived with the customer as a super advisor that knows everything and arrive with your team like a boss that have everything under control. Instead of that, let's speak about what is your concerns, my concerns. I have doubts. You have doubts, but we can explore together and solve it together. I think that's the way, I am working right now, reading out of the expert label that many companies place on their brand. And in order to the people, we don't have the world solve for anybody, but together we can create that solution that you need. And again, solutions for the team working, they have trouble and challenges, and they need work and everything. And also, for the customer that is trying to impact the market or change a market or something together, we can figure out.

Jose Leal (27:40):

The word that comes to mind for me is collaboration.

Guillermo Espinola (27:43):

That's it.

Jose Leal (27:45):

So, what else would you say? We've got a couple of minutes left. Any other things that you think I've got two minutes. I got to say this.

Guillermo Espinola (28:01):

Okay, this is advice for people who are starting to build software. It's like, don't be afraid of failure in what you're building, don't expect everything will work the first time. But the clue of building an in-house team or a remote team, or how, however, the model you want of the key to the success is not to fail, is how fast we can learn and overcome failure to try something different. So, I think my last two minutes are that don't be afraid of failure. Let's go make mistakes fast, learn fast, overcome, and always think about doing good or advancing to our purpose. So never lose sight, and this, you know, the mermaids will sink in different parts. You will say, okay, if I did do this for a while, that's fine. I will get the money that I need to be better tomorrow. But if it's not in the same direction as you're going, that's not helping you. Maybe it's money, but it's just deviation and that will be a mistake that is hard to overcome from that, mistakes in the correct direction are easy to overcome.

Matt Perez (29:43):

All right, I think we've come to the end of our time here with the half hour at Mark, and I'm getting directions from Carlos to cut to for wrap-up. In goodbye words. So anyways, my goodbye words here are that this has been a pleasure and I mean, I know you personally and know what direction you're going, but I think you expressed it, really express it really well. And glad to have you and that train model I really liked something that we learned from you. So, Jose, you want to.

Jose Leal (30:27):

Yeah, thank you, Guillermo. It's a pleasure to hear that you're feeling into this, that you're going through this process, not with ideology in mind, but with slowly collaborating, slowly sensing what's right and what needs to be happening. So, this is awesome. Thank you. And thank you all for joining us and for attending today's live show.

Guillermo Espinola (30:56):

Thank you to you, guys. It's always a pleasure. I think I learned a lot from you every time we speak, and I really appreciate that you invited me to hear. I'm still get a little bit nervous when I'm in front of the camera, so I see like a robot sometime, but I'm trying to get chill, thank you very much. You make it a lot, a lot this easier.

Jose Leal (31:24):

Yeah.

Matt Perez (31:25):

Thank you.

Jose Leal (31:26):

And it's funny because we are in front of the Zoom camera all day long and still, we get a little nervous when we do these interviews, so thank you for showing up and for being so caring.

Guillermo Espinola (31:38):

Thank you, Jose. Thank you, Matt.