By Andrew Patterson
Ask most people where the world’s most popular DJ software is produced and they would probably answer the U.S or perhaps even the UK...
Home to some of the world’s most famous bars and clubs in places like New York and Vegas, the U.S. has always been the centre of popular music culture while London is famous for clubs such as The Ministry of Sound, Fabric and Heaven.
Yet, you’d be wrong. Walk into any bar or nightclub anywhere in the world and there’s a 70% chance the DJ will be using Serato software, created and developed right here in NZ.
Housed in non-descript offices in Auckland’s CBD, the external façade gives no clue to what exists within its four walls.
Stepping inside is like entering an Aladdin’s cave of technology that has you feeling as though you've enterted another world. It's every teenagers dream work environment. A huge office kitchen that doubles as a late night club, a research and development team focused on coming up with even more innovative ways for DJ’s to use Serato software and working with people who get to do what they love doing anyway – reinventing the way music is mixed by some of the world’s biggest names in the business.
With DJ hardware available that can be purchased for as little as $250, the business is now within the reach of a new generation of users who previously would have been prevented from entering the market due to the prohibitive costs involved.
Like many kiwi entrepreneurial success stories, it’s a business with humble beginnings.
Originally founded in 1998 by Steve West and AJ Bertenshaw, who were both students at the time, West was learning to play the bass guitar as a side interest. He wanted to slow down complicated bass solos in songs in order to hear each note and subsequently learn them.
After a little research and some clever maths, West wrote an algorithm making it possible to change the tempo of audio independent of the pitch.
This resulted in a tool that could speed up and slow down any piece of audio (including the bass solos) without colouring and distorting the resulting sound. Conversely, it could also alter the tempo of a piece of audio without changing the pitch. Not only that, but it was all done in the time it took to make a cup of tea.
A lucky break finding the dream job
Fast forward a few years and current CEO Sam Gribben discovered Serato while on his OE and the business has now become his life’s passion.
With a background in engineering, Gribben couldn’t quite believe his luck when a friend stumbled on the very idea he had been wanting to pursue
“Previously, I had been studying electrical engineering at Canterbury University and at the same time learning how to DJ and I was really intrigued by the fact that you've got this big 12 inch vinyl record that you interact with, manipulate and literally get your hands all over it to create these unique sounds.”
“The music itself is almost secondary. I was learning about how you can control computerized systems through my engineering studies. And I was thinking: wouldn't it be great if you could use a vinyl record to control an MP3 playing on a computer. I didn't quite have the technical skills to actually be able to pull it off so I tried to talk all my engineering mates in to helping me build it.”
“10 years on and I was living overseas at the time and I get this call from a friend saying: Hey, I’ve just met these guys at a barbecue and they’re doing that thing that you've been talking about for the last 10 years and they’re just down the road here in Auckland. So that was quite a surprise and so I moved back to New Zealand and teamed up with the original founders of Serato, Steve & AJ.”
Low profile but high visibility in its sector
Google Serato and you won’t find too much written about the company in this country which Gribben says has been a deliberate strategy.
“For a long time, a lot of people didn't know that our products came out of New Zealand. We're very strong in America and most of our American customers assumed it was American, to the point where there'd be internationally touring DJs who'd come down here from the States and they'd meet local promoters and be like: Oh, you're using Serato, do you want to go meet the guys that invented it? And the DJs would be like: What do you mean they're from New Zealand. They had no idea...they had all assumed that we were an American company.”
“It’s something I believe very strongly and I'm quite passionate about. There's no reason why a company like ours can't come out of New Zealand and can't be headquartered here. We don't have a very big profile in New Zealand because for such a long time our focus was on the US and Europe and Asia, that's where our market was.”
“There’s also the issue of the way we’ve structured the business where our software is supplied as a licensing deal, so it's actually supplied to hardware companies such as Pioneer for example, and they sell the product with our software already pre-loaded. Even in New Zealand you didn't buy the Serato product, you bought that American product through their distributor.”
“In recent years we’ve started to push the NZ angle a bit more and raise our profile, but for a long time I guess we were seen as an American company.”
It’s all about the passion for music
Serato is a business built on passion where many of its staff have music in their blood. It’s also a business that was born global.
“We knew that we had something big because we'd take the product to trade shows and we'd get these amazing DJs try it and say: this is something, this is going to change things.”
“We've certainly grown up a lot in the last few years and it feels really good as an employer to be able to employ people in a job that they absolutely love doing.”
“As someone who has done that kind of typical Kiwi OE - gone overseas and worked in Europe and then come back - I've got lots of friends that didn't come back and they're still over there. What I’ve been conscious of is creating the kind of jobs that people would want to move back here for and be a world leader in technology from New Zealand. There's no reason why that can't happen. And I really think that you're seeing it more and more with some of these emerging technology companies such as Xero.”
“I talk about technology companies because that's my space. But I think that collectively we have a real opportunity to develop New Zealand as a brand for technical excellence and being a place where the amazing technology based products and services can come from.”
However, recruiting staff with the necessary technical expertise is as much a problem for the likes of Serato as it is for many other business operating in the technology space.
“Staff recruitment is always an issue for us. It's always tough to find the right people. We operate in a kind of unusual tech space in that we're not web developers. We do develop more desktop software so that makes it harder in some ways as there’s a smaller pool of people to choose from. But on the other hand if someone is interested in the technology we use and interested in music, it's a very, very easy hire to say come work for us because they're really into it.”
“We’re actually a very international collection of people, as I recently discovered. I did a little snap survey on our internal Yammer network and between us we speak 27 languages. The definition of that is that you could order a beer and then debate with the bartender what flavour of beer they would give you!”
“We also have a varied range of musical interests from hard-core metal, rock singers, punk rockers even opera singers. All different sorts but were all driven by a love of music. It really fuels a lot of the passion here.”
Being honest with customers pays off
So how does the customer engagement process work for a business like Serato and how does the development of the product reflect the different needs of its DJ end users?
“It's evolved over time and it's challenging because you have so many inputs now, so much information coming from so many different places. It’s interesting to talk about how it started. When we first launched the DJ product we had a web forum in 2004 and we built the website later around the forum. It was all about that forum where we tried a few interesting things. We did our tech support on the forum which at the time was quite unusual. People's problems were very much out in the open which meant their solutions were also out in the open for everyone to see.”
“That did a couple of things. Firstly, it showed people that we weren't trying to hide anything, and at the time tech support was mostly done by e-mail. If other people saw what problems people were experiencing and what the solution was that meant helping one person often meant you were helping several people. From a customer service point of view if we had really difficult customers, sometimes it was quite clear that they were just being difficult and it wasn’t because we were being the evil corporation and everyone could see that. That has evolved and now we do a lot on Facebook, Twitter and through all different channels, but the openness remains.”
“In recent years we've adopted a user centred design philosophy which basically means we design something we develop something and then we get people in to try it. We get them into our studio – we've got a little studio – and we don't tell them too much what we expect them to do with the product.”
Serato has plenty of competition to consider with others wanting to muscle in on the space but as the brand leader it focuses on the user experience.
“Historically we’ve never been about being the first. We weren't the first into the DJ space, but our approach is to try to be the best and to really focus on the things that matter. Usability and performance are our two key metrics that we focus on and if you're playing in front of thousands of people, the most important thing if you’re a DJ is that the music keeps playing. So we put a lot of emphasis on stability.”
“We’ve had a really good run over the last 10 years, but it has become a lot more competitive. A lot more companies are getting into it. Everybody wants to be a DJ. There's mass consumer brands like Casio and Philips who are starting to get into this space, so it is getting more and more difficult. I think it's important to know who you are and how you fit into that space.”
Gribben says the most important thing he’s learnt is the value of honest customer engagement.
“You really have to listen to customers; that’s something I’ve come to appreciate along the way. One other thing that we did that was unusual was that we didn't censor the user's forum. We had three rules, don't pass yourself off as one of us – don't pretend to be one of us, don't sell anything, and be nice to others. And so people talked about competitive products, and they talked about how the other products were better. At the time, our competitors were shutting down those conversations, shutting down their forums and we just let it all happen. We watched and we listened to them, we were able to be pretty open and authentic with them and I think particularly the American customers were taken by surprise with our approach.”
“In a world where they're used to customer service representatives who said: so is there anything else we can help you with today and we were saying things like: Hey DJ So-and-so, I really liked that mix tape you put up, I'm into this kind of thing, here's my mix tape and they were like, wow, these are real people. We fessed up when we made mistakes and we were quite open with them. So really engaging with customers honestly – and I know this sounds like something out of a business school text - but being real with them is so important to build that loyalty factor.”
A template for NZ?
Gribben believes Serato is the ideal model for NZ to replicate. Highly skilled, with strong brand leadership and expertise in a defined space, it’s a classic weightless export that is creating real value for the country.
“I'm a really strong believer in this type of company as a model for future New Zealand success. There are lots of niche markets out there for us to compete in and there is no reason why New Zealand companies can't get in and dominate those markets. We're a small country and obviously we don't have a huge population but we have highly skilled, highly educated and very smart people who are very good at developing very clever technology.”
“I like to refer to it as creative people with a can-do attitude. So we have a lot of those valuable characteristics to develop a brand as a country that does really interesting things. You know, we're far away from the rest of the world but these days that matters less and less because so much is done online. We've seen a change in our industry from doing things at trade shows to doing things purely online. To have the space to really get your message out and it's something that can really grow. It really scales, unlike our traditional industries, these markets and these types of companies can really grow quickly.”
“Basically what we do is we get a whole bunch of really smart people together in a room and then we think up ideas in the form of software and then we sell that out to the world. To me that seems like an obvious formula to make NZ even more successful in the future.”
It would be hard to find anyone who would disagree.