Steve Phillips is CEO and founder of Zappi, the leading consumer insights platform. The company has always put an equal focus on people and planet and is a registered B Corp. In late 2022 Zappi raised $170m from investors
Steve describes himself as a “perpetual problem solver”, always looking forward and solving the next problem. “Sometimes that’s coming up with something new and innovative. That's what I find most exciting.”
He also sees himself as a disruptor and, as with most founders in his view, “an irrational optimist”.
But now that he is CEO of a well-established business, things are not the same. “When you start a business, you’re paranoid about liquidity and whether you can pay the bills at the end of the month. The business is mature now, we've got investors and cash. Now I might be worried about structure or a particular client problem. But the truth is I’m not kept awake at night like I was at an earlier stage when the business was genuinely struggling. I sleep better now.”
Perhaps that "irrational optimism" helps “I describe founders of companies that really want to scale as having an irrational level of optimism. Typically, if you're trying to genuinely change an industry, it's unlikely you're going to succeed. You need a lot of belief in yourself and your idea. That belief is probably irrational because most people don't succeed. But somewhat silly amounts of optimism can be a very helpful thing.”
Somewhat silly amounts of optimism can be a very helpful thing
Despite being a serial entrepreneur now on his fourth startup, Steve spent the first 15 years of his career in the consumer insight industry, working for other companies. “I knew the industry well and I knew what skills and ways of working clients wanted and the types of research needed. But then I set about trying to innovate and disrupt the industry. A lot of my earlier experience was essential for me to understand what was happening.
Steve describes Zappi as “a classic technology company” and that typically in order succeed a founder would typically need both “technology expertise and domain expertise”. He happily admits that he launched with only half the picture. “The truth is, I knew nothing about technology when I started this tech company, but I ended up finding a company to help me build it and then we merged. So, we ended up with that domain and tech expertise combined.”
Like many good ideas, Zappi was dreamed up over a drink. Steve says he was sitting in his garden when he came up with the idea. “I was sitting in my garden with a glass of wine. I may well have had two. I came up with the idea of trying to automate the consumer insights industry. It's a professional services industry, so other people hadn't really thought about automating it. I wanted to automate the whole process, because while clients thought consumer insight was wonderful and illuminating, they moaned it took too long and cost too much.”
Steve set about solving these issues of speed and cost through automation. He says that over that glass of wine he came up with an entire business structure. “That initial plan was the impetus for at least the first five years of the business. I came up with everything that we did for the first five years in 20 minutes or half an hour in my garden. As with anything, it was 1% inspiration, 99% perspiration. The rest of the time was an awful lot harder than that first couple glasses of wine.”
Steve is not one to linger long in the moment or to dwell on the past. “You never feel pleased with yourself for what you did last year. Only the paranoid survive, so you're always thinking about how you're messing things up and how you're going to improve them and about the ideas you have for the future, how you're going to solve this problem and avoid the next one.”
Even with this relentless focus on the future, there are still moments to stand back and reflect. “I don't get a huge amount of satisfaction from doing that. It's not what drives me. But sometimes you have a big moment. We did a big fund raising in 2022 and we raised $170m to push the company forward. There were times after that where I had a moment of satisfaction.”
The business is focused on sustainability and social good. “We're a B Corp and the thing I like about B Corp is it balances people, planet and profit. Culture has always been essential to what we've done. We've pushed for radical autonomy in many situations. Our two core founding values are trust and truth. We trust our people to do the best work in the best way for the company's sake and for themselves. We stole Netflix's expenses policy, so our expenses policy is to treat the company's money as if it was their own. We don't check expenses.
"Sustainability is important to me personally, but I'm not sure I would say it’s business critical. It's people critical and it's what we care about. Is it good for investors? Yes, probably it is. But that's not why we do it. We do it because it's good for humanity and the planet and the people we work with, and that's what matters.”
While loving his current role, Steve says he also partly misses the start-up excitement. “At the start of the business you are free to experiment and create. You have no debt and no people. You have no structures and processes to hold you back. You are free to be anything. It is a lovely moment. The hardest part is the middle bit, where you're struggling to find clients and good people. You come out the other end of that as well. Now we are big enough I don't need to do any of the annoying admin. I can focus on things I'm passionate about, such as innovation, where the company needs to be in the next five years.
But this growth and evolution has an impact on how disruptive you can be. Steve describes himself as “very much a disruptor”, but adds that the longer a company goes on and the more it scales, the less it tends to disrupt. “Increasingly, we've pulled in people who can scale the disruption we created. The company at some point will be much less about disruption and innovation and more about scaling across countries, companies and categories. There is a change a company goes through in its innovation journey and its scaling journey. It's not like you are disruptive forever. Look at any technology company, they all start as disruptors and end up massive scale companies, and it's hard to do both of them simultaneously.”
Throughout his journey, Steve says he has relied on groups of people around him. “It's really important to listen and learn from other people who have had and are going through similar experiences. And it's great to be part of Helm and the Forum, which particularly in the early stages, acted for me like six or seven non-exec directors who knew my business and could help me think through problems over the long term. Hopefully, I've helped other people as well with my advice and support. That group of like-minded people going through the same problems is very powerful and extremely useful. I'm always looking for new ideas, new ways of thinking, new people to learn from. And it's an essential part of being able to adapt, being agile, being able to understand what's going on in the world and make sure the business thrives in that circumstance.”
It's great to be part of Helm. Forum, particularly early on, acted like six or seven non-exec directors who knew my business and could help me think through problems
Asked to define success Steve is temporarily non-plussed, “It’s part of that looking back component. People say the company is doing well and ask if I feel wonderful that it's successful. That's not what I'm thinking about. I'm thinking about something that went wrong today. But I try and define success in advance. There are things I want to achieve this year and we work from KPIs and have specific strategic goals. I will absolutely be working to that definition of future success and ticking them off.
“Although sometimes you need to stop and smell the roses and have a glass of champagne and celebrate. It just doesn't come very naturally to me. Largely because I don't find it very interesting. What I find interesting is solving the next problem, the next innovation. It's about where we're going.”
Quickfire questions
I was born in Worthing and I have one brother and one sister
My first job was picking fruit in the Herefordshire countryside
The word I'd use to sum up being a founder is risk
My Founder’s Brew is a cup of tea, with a tiny bit of milk
