I'm Rohan Karamandi and I'm Phil Hawthorne and we're the hosts of the Home Assistant Podcast. We're guessing you're into technology. Home Assistant is the number one open source contributor project on GitHub with a focus on privacy and local control. Join us every other week as we break down the latest features of Home Assistant and talk to everyday users who are automating their lives with Home Assistant.
From feeling like you're living in Star Trek with lights turning on in rooms when you walk in, to automating flushing the toilet. Home Assistant can integrate with virtually anything and we've interviewed everyday people like yourselves that have done some pretty crazy automation. Listen to the Home Assistant podcast wherever you listen to your favorite podcasts or find us on YouTube or visit homeassistant.fm.
We're building really the first Linux distribution in the cloud. And for anyone that has worked on a Linux distribution, you're not starting from scratch. You're starting from some pre-built. building blocks like a kernel, different user land software that you're going to put together and then deliver that as a distribution. At Federated Computer, we had a very similar problem set where we're taking some pre-built building blocks.
And then we're combining them in a way that makes it easier for the customer to adopt. My name is David Young. I am the founder and CEO of Federated Computer. This is Code Story, a podcast bringing you interviews with tech visionaries. Six months moonlighting. There's nothing on the back end. Who share what it takes to change an industry. I don't exactly know what to do next. It took many goes to get right.
Who built the teams that have their back. A company is its people. The teams help each other achieve more. Most proud of our team. Keeping scalability top of mind. All that infrastructure was a pain. Yes, we've been fighting it as we grow. Total waste of time. The stories you don't read.
in the headlines. It's not an easy thing to achieve, my dear. Took it off the shelf and dusted it off and tried it again. Drive the ups and downs of the startup life. You need to really want it. It's not just about technology. All this and more on Code Story. I'm your host, Noah Labhart. And today, how David Young is enabling you to save 75% or more on all the software you need to run your business.
This episode is sponsored by Speak Easy. Grow your API user adoption and improve engineering velocity with friction-free integration experiences. With Speakeasy's platform, you can now automatically generate SDKs in 10 languages and Terraform providers in minutes. Visit speakeasy.com slash codestory and generate your first SDK for free. Thank you.
QA Wolf gets engineering teams to 80% automated end-to-end test coverage and helps them ship five times faster by reducing QA cycles from hours to minutes. With over 100 five-star reviews on G2 and customer testimonials from SalesLoft, Drada, and AutoTrader, you're in good hands. Join the Wolfpack at QAWolf.com.
David Young spent many years in California but lives in Colorado Springs now. He mentioned that things outside of work are very important to him as they are the soil from which he brings fruit to bear in his work. He's married and loving living in the Rockies. He and his wife love to ski, hike, and camp, but most interestingly, they are both endurance athletes. They run marathons, long distance bike rides, and triathlons. In fact, David himself has run 10, which include a 2.4 mile swim.
112-mile bike ride, and then a marathon. all in succession, all in one day. David noticed that the problem with SaaS today is that it's expensive. and adds up as you compile solutions. Right alongside that, open source software is free, but requires more setup and maintenance to keep it up and running. He decided that there must be a better way to purchase software while getting the best price on a bundle of solutions. This is the creation story of Federated Computer.
Federate is a very simple idea, which is People love purchasing their software using SaaS, software as a service. Whether you're using Google Workplace or Zoom, SaaS software is just that idea that I can get access to great software. and use it through a web browser. The problem with SaaS is that I can't buy all of my solutions from a single source, so I'm going to a bunch of different sources to line up.
the different types of software that I might need for my business. This is not my first rodeo as a startup, but I started to have an insight that, in fact, there were a lot of open source solutions. that provided very competent, if not better, solutions to say email or online spreadsheets and Word documents and all these sorts of things. The problem with these open source solutions is they're difficult to install.
to keep running, keep patched, keep them secure, keep them backed up. All the reasons that we love SaaS software, I just go give them my credit card and I get a great solution. And so what Federated Computer does is we provide customers with all the open source SaaS software they need. It's easy to use. They don't have to worry about doing all the IT problems to keep it up and running. And they get it for a really nice low price. So today, the...
businesses spending between $300 and $400 per employee per month on SaaS software. With Federated Computer, you can get our best tier with video conferencing that supports up to 500 users, groupware, online docs. documents, spreadsheet, online no-code database, so many different solutions for $120 per domain, meaning per company per month. So it's a tremendous savings opportunity for business.
I and all my co-founders, we have a long history in the cloud. In fact, we founded a company called Joint, which really invented cloud computing. And so we're accomplished at economizing and optimizing cloud solutions. So we've taken all this open source software. It's entirely private.
Every one of our customers gets their own install. So there's shared nothing between customers. There's no possibility of data leaks between customers. Everything's secure. It's very flexible because it's open source software, but you get. Everything you need in a single sign-on, a single throat to choke, so to speak, for an amazing price. That's what Federated Computer offers and delivers to our customers.
So let's dive into what you would consider the MVP for Federated Computers. So that first version of what you built and what you offer, how long did it take you to build and what sort of tools were you using to bring it to life? We're building really the first Linux distribution in the
cloud. And for anyone that has worked on a Linux distribution, you're not starting from scratch. You're starting from some prebuilt building blocks, like a kernel, different user land software that you're going to put together and then deliver. that as a distribution. At Federated Computer, we had a very similar problem set where we're taking some pre-built building blocks and then we're combining them in a way that makes it easier for the customer to adopt.
So we're not reinventing, say, the part about the no-code database. That comes to us from base row. or the groupware that comes to us from NextCloud or the Dropbox replacement also comes from NextCloud. or the video conferencing, which comes from Jitsi. These are pre-built building blocks that we're able to use. The problem that was in front of us was to integrate them so we had...
single sign-on, easy user management. You're not managing the users across each of these different solutions. You have a single place to manage users. We integrate user management storage so that you're not managing storage across a bunch of different services. It's simple. It's easy to use. We really had to go out there and discover the different capabilities of each one of these building blocks because for the first time, we began to build a matrix of capabilities.
and deficiencies so that we could figure out what's the glue, what's the cement that we needed to invent from Federate Computer in order to be able to deliver our first version. We did most of this using system tools. So bash, go.
these sorts of languages so that we could begin to glue this stuff together. But then we also used a lot of our work that we've done in the past on optimizing the operating system that we use on our cloud provider so that the operating system is highly optimized for storage, the way that it uses memory. We make it economically really advantageous for them to try, give us great feedback. And that's really how we launched back in 2022.
This episode is sponsored by Speakeasy. Whether you're growing the user adoption of your public API or streamlining internal development, SDKs can turn the chore of API integration into effortless implementation. Unburden your API users from guessing their way around your API while keeping your team focused on your product.
Shorten the time to live integration and provide a delightful experience for your customers. With Speakeasy's platform, you can now automatically generate up-to-date, robust, idiomatic SDKs in 10 languages and Terraform providers. in just a matter of minutes. SDKs are feature-rich with type safety, auto-retries, and pagination, everything you need to give your API the developer experience it deserves. Deliver a premium API experience without the premium.
Visit speakeasy.com slash code story to get started and generate your first SDK for free. This message is sponsored by SnapTrade. Link end-user brokerage accounts and build world-class investing experiences with SnapTrade's unified brokerage API. With over $12 billion in connected assets and over 300,000 connected accounts, SnapTrade's API quality and developer experience are second to none.
SnapTrade is SOC 2 certified and uses industry-leading security practices. Developers can use the company's official client SDKs to build investing experiences in minutes without the limitations of traditional aggregators. Get started for free today by visiting visiting snaptrade.com slash codestory. I'm so pumped about my new offshore dev partner. I'm saving a ton and they even signed an NDA.
Wait, is that our financial statements on the internet? My dev partner has great communication. They can acknowledge an issue or email message super fast after they run it through Google Translate, of course. I have a call set up with my partner right now. Hey, guys. Guys, are you there? Wait did you just ghost me? Ever been in these situations?
That is, until I found Tecla. Tecla is world-class, nearshore talent for technology teams who demand the highest standards. The platform gives you access to over 50,000 vetted Latin America technology experts. including developers, designers, and IT professionals, all fluent in English and all in your time zone. In seven days or less, you can have your tech expert hired through techless, fast, efficient hiring process. which helps you find and onboard top candidates.
Get senior-level talent at competitive rates, often half the cost of hiring in the U.S., but aligned with U.S. work culture and time zones, making teamwork easy and productive. Hire the best tech experts today with TechLed. Learn more at tecla.io. That's T-E-C-L-A dot I-O.
This episode is sponsored by Vanta. You're a startup founder. Finding product market fit is probably your number one priority. But to land bigger customers, you also need security compliance. And obtaining your SOC 2 or ISO 27001 certification can open those big... doors, but they take time and energy pulling you away from building and shipping. And that's where Vanta comes in.
Vanta is the all-in-one compliance solution helping startups like yours get audit ready and build a strong security foundation quickly and painlessly. How, you ask? Vanta automates the manual security tasks that slow you down, helping you streamline your audit and
with trusted experts to build your program auditors to get you through audits quickly and a marketplace for essentials like pen testing so whether you're closing your first deal or gearing up for growth vanta makes compliance easy join over 8 000 companies including many Y Combinator and Techstars startups who trust Vanta. For a limited time, get $1,000 off Vanta at Vanta.com slash Codestory. That's V-A-N-T-A dot com slash Codestory.
So let's go past that launch point, right? You move forward after you've launched it, you're getting feedback, you're understanding what's working, what's not. How did you build your roadmap? How did you go about deciding, okay, This is the next most important thing to create, to address, to offer with Federated Computer. I like to build products that I want to use. I have never really been that successful building a product that I don't have a person.
personal interest in or a personal, say, this is a product that I wish existed because I would use it. I wanted to, really for reasons of privacy, begin to get off of tools like Google and Zoom and these other tools where we know that they're using our data for the sake of advertising or training their AI. And I wasn't down with that. So it was like,
What are the things that I'm using today? And this isn't to say that these aren't great products. Google Workplace is a great product. Zoom's a great product. The thing is that their business models include this use of our data. So I began to do an inventory of the products that I was using. and then saying, how can I get off those products? What are the solutions, the alternatives, the open source alternatives that I can bring to bear?
And then how do we need to integrate them with our single sign-on, our user management, our storage management, the rest of it? so that we can deliver a product. And so that was really the first thing that we launched with is a transformation of the tools that David Young, that I was using in SaaS as a business owner and saying, let's get to some additional sort of open source.
As we've continued to look at the roadmap, we watch our customers. This is what's so great about this is a customer will come in and say, I love federated computer, but what I'm missing is a way to manage hourly workers. I'm missing a way to manage project management. I don't want to be on JIRA.
So we begin to add additional capabilities in the product as we bolt on the additional open source SaaS products based on the desire of our customers. So it's a very organic way of developing the roadmap. On top of that, we make it easier and easier for our customers to use the product as it's integrated. So for us, and this comes from a lot of experience, part of this is me building the product for me, but then...
saying, hey customers, what do you think of this product? And then we have to be really good about listening to those customers. Now, one of the things that happens when you begin to listen to customers is they inevitably say, hey, it'd be great if you did this or that. You begin to go down this balancing act as a product manager, balancing between customer spoken desires.
It's eliciting from a customer what they're really wanting as far as a solution. We have a solution, an alternative to, again, a great product. It's a very expensive product, but it's a product that a lot of people use. managing their mailing list. we would get these sort of things where customers would tell us that the alternative that we were delivering to them which is called list monk they love list monk it's a great product but we just need this or this other solution so typically if you're
product manager and you have a vertical product where you have this silo where you're just doing mailing lists, you're going to deliver all those solutions within the mailing list silo. But when you're more of a Linux distribution in the cloud, you begin to treat each of these silos as little individual tools and you think maybe I don't have to do
My CRM capabilities, for example, in my mailing list tool, what I needed to do is figure out how to connect the CRM tool that I have. And in our case, that's Espo CRM. Connect that with the mailing list in a really efficient way. Typically, that's not done in proprietary SaaS because MailChimp has this burden of wanting to deliver everything to their customers. But in open source SaaS, which is what Federated does,
We really have the opportunity, in fact, we have the mandate of connecting the tools together. So we make it so that ListMonk works really well with Espos CRM. That's a real benefit for customers because now they get the benefit of the flexibility of the open source SaaS rather than sort of us trying to jam more and more functionality into a particular tool.
So I'm curious about team, right? How did you go about building your team? And what do you look for in those people to indicate that they were the winning horses to join you in this mission? Most of the team at Federated Computer are people that I've worked with in the past at Joyent.
But just to review, Joint was really the first infrastructure as a service cloud company. So if you wanted to get containers or virtual machines over the web, Joint was there first. We were the first to sell this. We delivered a lot of great technology.
And so when I went to go do Federated Computer, I reached out to some of my colleagues at Joyent and I said, hey, this is what I'm thinking of doing. But now a little bit up the stack where we're going to be using open source to deliver solutions to customers. to end customers rather than just infrastructure. So I had the benefit of being able to work with people that I knew. what their vibe was, their ability to work under stress, certainly their technical capability.
Now we have brought on a few new people to Federated Computer. We're not just building a silo. It's not just a question of, hey, are you able to do Elixir or what are your Python skills or what are your Go skills? That's not. enough because when you're bringing together a bunch of tools from a bunch of different projects and you're putting them together, you need to be pretty ecumenical as far as your ability to use and understand technology.
When we do look for new people, we really need to be cautious about making sure the vibe of that person is in sync, meaning they understand what we're trying to do from a sort of philosophical, cultural standpoint, helping people to adapt. open source software, helping people to adopt open source SaaS and really the mindset of open source with the privacy, the flexibility, and the great price. And when they do have that, they're very successful at Federated Computer.
The second thing, you know, for me, when you're working with new people is you figure out how to learn about them as much as possible. Because I think of development teams as being a bit like bands or like film crews where, you know. I'm not doing everything. Everything doesn't come from me. I'm the founder. I'm the CEO. Yes, I run product management, but I really want colleagues around the table.
that can bring a lot of ideas and vision. It's going to be super helpful if they have a background in open source, they understand what we're doing and the ability to connect. a lot of different tools together and get the benefit of that sort of all those strands being tied together in a single powerful offering. This message is sponsored by QA Wolf. If slow QA processes bottleneck your software engineering team and you're releasing slower because of it, you need a solution.
you need QA Wolf. QA Wolf gets engineering teams to 80% automated end-to-end test coverage and helps them ship five times faster by reducing QA cycles from hours to minutes. With over 100 five-star reviews on G2 and customer testimonials from SalesLoft, Drada, AutoTrader, and many more, You're in good hands. Ready to ship faster with fewer bugs? Join the Wolf Pack at QAWolf.com to see if they can help you squash the QA bottleneck. This message is sponsored by Snapchat.
experiences with SnapTrade's unified brokerage API. With over $12 billion in connected assets and over 300,000 connected accounts, SnapTrade's API quality and developer experience are second to none. SnapTrade is SOC 2 certified and uses industry-leading security practices. Developers can use the company's official client SDKs to build investing experiences in minutes without the limitations of traditional aggregators. Get started for free today by visiting snaptrade.com slash codestory.
So where does scalability come into play and make it difficult? for you? How have you addressed scalability, either as a business or in the technology, the things like that? And I'm curious about if there's any interesting areas where you've had to fight it as you've grown. Yeah, so the question of scale is something that I've dealt with a lot in my career as a sort of general purpose infrastructure company where we were selling.
access to virtual machines, containers, networks. We were very blessed to have customers like early Twitter. Twitter really launched on joint. Tumblr launched on joint. The early Facebook developer program launched on joint. And what this actually taught me is that scale matters for very few projects. In fact, the key to scale is not getting big. It's figuring out how to get as small as possible. And I think you're starting to see some of this in this movement.
I don't know exactly what I think about it where people are... moving from the cloud back to self hosting. I think the intuition there is that actually getting Amazon scale is not that important for my project. In fact, being able to get the scale of my project down to the right size for my project is much, much more important. important for the sake of understanding the tools.
understanding the rules, meaning how these tools interact, the ability to hire against the problem. In the case of Federated, most of our customers, you know, most companies that are going to want these sorts of business tools are small business. So we spend most of our time not thinking about oh, geez, how are we going to be able to serve a Fortune 500 company? But how can we really effectively serve, say, a company with 10 employees where, yeah, everything needs to work really well?
It needs to scale over time in the sense of the operations are there, it works, we figure out. how to deal with that customer's infrastructure. using machine learning and make sure things are running and capable and all the rest of it. From a business standpoint, we want to do that spending the least amount of money because that's going to go to our margins. So we figure out how we give the customer this fantastic a purpose-built experience.
spending the least amount of money. That's what scale means for me. Okay, David, as you step out on the balcony and you look across all that you've built, what are you most proud of? case of federated i'm proud that we are building a tool it's not a super sexy tool our offering is not ai and it's not to disparage ai it's just something that people need and want when they find out
about Federated Computer, they need it, they want it. They say, that's going to save me a lot of money. I like the fact that all my data is private and I get this flexibility. And so it's a real platform and platforms. Because of the flexibility, customers can build on top of it. Platforms are difficult things to do, but they're very gratifying because And I've built a few platforms. It seems like that.
the thing that attracts me the most. But when you're successful building a platform and you see your customers doing things with it that are unexpected, then that's really gratifying because you see that you've put in place the fundamental pieces you've put in place.
fundamental connections between all these tools that customers can take up the offering and begin to do things that are purpose-built for them without you having to think about it. Okay, let's flip the script a little bit. Tell me about a mistake you made. and how you and your team responded to it. When are we not making mistakes? We actually want to make mistakes in the sense that we want to be in the position of let's try things.
There's a full VPN that's part of Federated Core, which is our offering. And I would say that it worked well. It wasn't as easy to use. So that was a mistake. We've now thrown that away and we have a different solution when it comes to VPN. We want to make mistakes because that means we're exploring the edge of our problem set. What we don't want to do is we don't want to make the same mistake. That can be deadly to a startup.
But, you know, the culture at Federated and the culture at my companies has been, we definitely want to break some eggs. We definitely want to get out there. and make mistakes. Now, typically, the biggest mistakes that I've made at Federate is having people that didn't end up working out. When that sort of thing happens, it's really on me.
more than it is on the person that doesn't work out. And typically, those sorts of hiring mistakes are done because I became... lazy in my process as far as figuring out who the person is. What are the motivations for both sides? We're all individuals. We all have our hidden talents and the way that we present. So it's a tough thing to do. And I found in the case of hiring a mistake. As soon as you begin to understand, hey, this was a mistake, the sooner you cut ties and move on, the better.
Let's move forward. What does the future look like for Federated Computer, the product for what you offer and for your team? We think we're really the first sort of Linux distribution in the cloud. No, we don't have a special kernel that only runs in the cloud and all that. But we are really the first.
sort of collection of SaaS, open source SaaS software. We've begun to work with third party SaaS projects and make it easier for them to operate as a project. So Our initial product was this curation of projects that we had put together, Federated Computer, but now as a platform, we can go to third-party projects and say, hey... So instead of you having to build your e-commerce stuff and all the rest of the stuff that you might need to support your customers.
You can get that all from Federated Computer. And on top of it, we can also help you so that your project integrates with lots of these other tools. That's a real boon for projects because then they don't have to do the e-commerce. They don't have to do all the ticket management, all the rest of it. That's something I'm really excited about. We're just beginning to roll that out to. our partners, our open source SaaS partners.
But then beyond that, I really feel, and this is going to... hopefully get some chuckles from people but I really feel it's like the change of seasons but I begin I think that people are beginning to see the power of open source both in the cloud, but also on their devices. And they're seeing that there's really some great things that they can do.
Open source projects, whether you're talking about on the phone or on the desktop, on laptops, desktops, whatever, is really great stuff. And so we have plans to continue to support those sorts of things.
Yeah, it's not going to happen overnight, but I'm old enough to remember when I would go to early web conferences and open source conferences and you would start to look around and people would start to... be bringing in these Macs because Macs were a great Unix development platform and you're beginning to see the turning of that away from
Macintosh towards pure sort of open source solutions. And I think that's something that we really want to get behind as a company. We're really well positioned because we have identity and authentication built into our platform. We can extend that out to devices and help customers adopt some of these great, low-cost, very capable open-source devices into their ecosystem.
Let's switch to you, David. Who influences the way that you work? Name a person or many persons or something you look up to and why. My sort of business hero is a guy named Herb Kelleher. Yeah, Herb Kelleher was the founder of Southwest Airlines. It's ironic that I'm talking about Herb these days because Southwest has sort of abandoned all the values of Herb Kelleher.
But I've studied Herb a lot. In fact, at one point, I creeped him at his Dallas headquarters. I was able to meet him as he was going to his car. And the dude was so gracious. What are a couple of things about the Herb Kelleher way? The first thing is really empowering employees and colleagues do the right thing, build the best product. And that's the way it is at Federated, I think.
Every one of us, no matter your position in the company, we're all sitting around the table as equals. Now, some of us, at the end of the day, we have to make some hard decisions. And sometimes that falls to me to make those decisions. But everyone has a voice in figuring out what the right product should be. That's something that I learned from her.
Employees come first. If you have happy employees that are really excited about their jobs, the product that we're building, the work environment, all the rest, then the relationship with customers is just going to be spectacular. because happy employees lead to happy customers. And we've really seen that here at Federated Computer. We have very satisfied, very happy customers because we have a great, happy team. And I learned this from Herb Kelleher, and it's really sad to see.
Some of the stuff that's going on at Southwest Airlines these days, they've been captured by a private equity firm. Who knows how long these values will last at Southwest Airlines, but there's something that I learned from Herb Kelleher.
So last question, David, you're getting on a plane and you're sitting next to a young entrepreneur who's built the next big thing. They're jazzed about it. They can't wait to show it off to the world and can't wait to show it off to you right there on the plane. What advice do you give that person? Having gone down this road a bit. For me, software development is a form of creative writing. It certainly is a form of creative writing. I don't just think that's my opinion.
But the ways that our colleagues in this industry have come up with these amazing ways to use these tools, the hardware, the software to create these just groundbreaking innovations is always just. Amazing. I remember when I first saw Google Maps with dynamic movement of the map, we were all just shocked but delighted. And so I think the first reaction, if the young entrepreneur sitting next to me... And showing this new sort of creation is a reaction of delight.
Because yet again, we have further innovation. in our industry. And that's positive. We need lots of innovation. When we don't have the innovation, our industry really becomes a difficult place. And it was like that towards the end of the Windows hegemony over the whole industry. I hope it always remains a place of innovation. But the other thing, if the entrepreneur asks my opinion, is innovation is not enough.
You have this great sort of technical breakthrough. Now the hard work begins because now you need to translate that into a sales message, a marketing message. It's really important. I was very lucky in my career to learn from people that were around the early days of HP, which was an amazing place in the 40s, 50s, 60s, and 70s for innovation, technical innovation. but then how you take that innovation to market.
And it's a hard thing to do. Even when you have just an amazing sort of technical innovation, it's important to appreciate and attach yourself to great people that can help you translate that innovation to sales. and to adoption. I think that's fantastic. Well, David, thank you for being on the show today. Thank you for telling the creation story of Federated Computer. I look forward to hearing more from your podcast. Thanks for everything you do in our industry.
And this concludes another chapter of Code Story. Code Story is hosted and produced by Noah Laphart. Be sure to subscribe on Apple Podcasts, Spotify, or the podcasting app of your choice. And when you get a chance, leave us a review. Both things help us out tremendously. And thanks again for listening. Are you looking for legit ways to make extra money? Our friends at The Side Hustle Show have put together this cool free 60-second quiz to help you do just that.
All you got to do is go to hustle.show. You can do it right from your phone, answer a few short multiple choice questions, and it'll recommend a few episodes of the hit Side Hustle Show podcast to start with. You can add your personalized Side Hustle Show playlist to your device. Learn what works and start making more money today. Again, that's at hustle.show or follow the award-winning Side Hustle Show in your favorite podcast app.
You just realized your business needed to hire someone yesterday. How can you find amazing candidates fast? Easy. Just use Indeed. Stop struggling to get your job posts seen on other job sites. With Indeed Sponsored Jobs, your post jumps to the top of the page for your relevant candidates. so you can reach the people you want faster. According to Indeed data, sponsored jobs posted directly on Indeed have 45% more applications than non-sponsored jobs.
Don't wait any longer. Speed up your hiring right now with Indeed. And listeners of this show will get a $75 sponsored job credit to get your jobs more visibility at indeed.com slash P-O-D-K-A-T-Z 12. Just go to Indeed.com slash P-O-D-K-A-T-Z 12 right now and support our show by saying you heard about Indeed on this podcast. Terms and conditions apply. Hiring, Indeed, is all you need.