HANNAH BATES: Welcome to HBR on Leadership, case studies and conversations with the world’s top business and management experts, hand-selected to help you unlock the best in those around you. Fabricio Bloisi was just 21 years old when he founded Movile as a small start-up in a garage, in the late 1990s. They specialized in building text messaging apps and selling them to telecom providers in Brazil. The company is now a global technology player, serving more than 150 million mobile customers worldwide. But in order to scale the company successfully, Bloisi had to evolve his leadership away from day to day operations. In this episode, Harvard Business School professor emeritus Lynda Applegate explains how Bloisi’s role as founder and CEO changed as the company grew. Key to this growth was Movile’s executive team, which Bloisi hand selected. The core team managed operations to keep the company nimble, and they ensured the company’s culture remained entrepreneurial and talent driven. That left Bloisi free to focus on the company’s strategy. If you’re trying to balance day-to-day leadership with the bigger picture, this episode is for you. It originally aired on Cold Call in September 2016. Here it is.
BRIAN KENNY: How many attempts does it take to create a killer mobile app? In the case of one Brazilian based company, the magic number was 29 because the next app they created PlayKids became a global sensation outselling educational apps from stalwarts like ABC and Disney. Today we’ll hear from Professor Lynda Applegate about her case entitled, Movile: Building a Global Technology Company. I’m your host, Brian Kenny, and you’re listening to Cold Call.
SPEAKER 2: So, we’re all sitting there in the classroom.
SPEAKER 3: Professor walks in and …
SPEAKER 4: They look up and you know what’s coming.
SPEAKER 5: Oh, the dreaded cold call.
BRIAN KENNY: Professor Lynda Applegate is the former Head of the Entrepreneurial Management Unit at Harvard Business School and the current faculty chair of the owner, president and manager program for executives. Her research focuses on the challenges of building new ventures and leading radical business innovation, and both of those themes seem to apply to Movile. Lynda, welcome.
LYNDA APPLEGATE: Thank you, Brian. It’s great to be here.
BRIAN KENNY: So let me just ask you to set the case up for us. Tell us about the protagonist and what’s on his mind.
LYNDA APPLEGATE: The Movile case describes the evolution of the company from its launch in 1998 by Fabricio Bloisi, who at the time was a 21-year-old recent college graduate with a degree in computer science from a state university in southern Brazil. And it follows how he evolved the company, continuing to evolve his own leadership to become a global mobile content and commerce company.
BRIAN KENNY: 21 years old. Pretty amazing to think about that. And in under 20 years, this enterprise has grown into a global enterprise with 700 employees, I think.
LYNDA APPLEGATE: That’s right. The case is set in early 2015 as Bloisi reflects back on how Movile had grown from a small team of entrepreneurs creating text messaging apps for mobile phones of the late 1990s and in Brazil. And an example of that is the Motorola flip phone. Do you remember the Motorola flip phone?
BRIAN KENNY: I remember I had one. I remember them.
LYNDA APPLEGATE: Most people don’t realize that smartphones didn’t come out really for consumers until 2007. That’s when the launch of the iPhone was.
BRIAN KENNY: Remarkable.
LYNDA APPLEGATE: So it really wasn’t that popular before and it certainly wasn’t popular in Brazil until later than that. So he started by selling these mobile apps, text messaging apps to telecom providers in Brazil. And at the time he only had a small entrepreneurial team. As I said, the case follows the evolution of the company until 2015. It’s actually what I call a real-time case where the ink rubs off on your fingers and he now has evolved it to over 700 employees who work in 10 offices in Latin America and have actually opened an office in Silicon Valley.
BRIAN KENNY: What prompted you to write the case? Why were you interested in Movile?
LYNDA APPLEGATE: Well, I’m interested first of all in how a global technology company and how some of the more recent global technology companies can become both big and small simultaneously, that they can be lean, performance driven, large global companies with all the power, resources and reach of a large company. And yet they stay at their core to have the hunger, agility, spirit and fire of a small company.
BRIAN KENNY: What are some of the challenges and growing pains that they’re facing, that Fabricio is facing as he’s moving down this path?
LYNDA APPLEGATE: Well, Fabricio actually started by providing text messaging apps and selling them to telecom providers in Brazil. You only had a very few telecom providers and there were no mobile app players back then. So he was able to come in with a very simple application developed by him and a few of his friends and start delivering that to the telecom providers who were be able to reach many, many different users. Starting in 2012, they started to try to find, can we sell applications directly to consumers? And so they went through 29 different applications to see what would fit. And it wasn’t until they developed PlayKids, one app that actually provides children with lots of mobile content that they were able to then find an application that within months became a number one application for children in Brazil and then around the world.
BRIAN KENNY: And they were smart in terms of how they built their partnerships around that app. They chose some interesting partners like PBS and other of the business side players who could kind of grease the skids for them in getting to those audiences.
LYNDA APPLEGATE: Yes, and what was interesting about that is they grew through acquisition. They received financing from a South African e-commerce giant, and were able to, in 2007, launch some of their e-commerce areas from that financing round. One of the things they did with the financing is they acquired a company called [inaudible] actually did business mobile apps and their partners were Universal Studios and Globo and Brazil. And so they were able to access content by acquiring a company that actually had those relationships with the mobile payment companies, with the banks and mobile payment, and also with the content players.
BRIAN KENNY: And Fabricio is probably in his late 20s at this point.
LYNDA APPLEGATE: That’s right, exactly.
BRIAN KENNY: Hard to imagine.
LYNDA APPLEGATE: Now he’s probably in his late 20s.
BRIAN KENNY: Can we talk about Fabricio as a leader today as opposed to the 21-year-old that started this company? What’s his leadership style like?
LYNDA APPLEGATE: I always say launching and scaling businesses is a team sport, and so you can’t understand Fabricio’s leadership unless you look at the people that are around him too. So when Movile started, there was one team of software developers, but as the company grew, they had to actually build out a leadership team. Where Fabricio really plays is in that innovator strategist kind of role. He’s the one that’s looking out and saying, “Where do we need to go next?” And really thinking about where the company strategy is going to go. Around him, he has people like his current CFO, who is a tremendously solid performance … At performance driven kind of management systems and operating systems. He’s got a really good COO who really knows how to run today’s operations. He’s got a tremendous head of talent management who really knows how to attract and retain the best people. All of them work together to create that culture that allows the company to be a very strong, performance driven, large organization with a very entrepreneurial culture that keeps the people and the talent and everyone kind of excited about being part of a global tech company.
BRIAN KENNY: For the emerging entrepreneur who’s listening to this podcast, who’s wondering if it’s possible to grow to the size that they want to but still be entrepreneurial, what would you advise them to do?
LYNDA APPLEGATE: I’d say for sure, yes, it is possible. People have been studying and trying to identify how can we be big, and yet at the same time, small and agile and act like an entrepreneurial firm nowadays that’s possible. The second thing is, it used to be that people felt entrepreneurs didn’t scale. So, there’s been a lot of research that said that an entrepreneur had to give up his company or her company when they got big. And we now know that’s not true. And in fact, entrepreneurs can scale. And there’s some tremendous research that’s been done that shows that the firms, the entrepreneurs who are able to scale, have to surround themselves with a team that covers all four of those roles. And more importantly, the entrepreneurial team needs to act like entrepreneurs. They have to think entrepreneurs, and they have to be a team in more than name only. So, they have to listen to one another, they have to respect to one another. I find a lot of entrepreneurs when they’re building their teams, they try to find people that are just like them. And the truth of the matter is you need people that play different roles as your organization scales. And so, you have to learn to respect those roles and to listen to people who play those roles and to work together as an executive team even as the company grows.
BRIAN KENNY: Great advice from Professor Lynda Applegate. Thank you for joining us.
LYNDA APPLEGATE: Thank you, Brian, for having me.
HANNAH BATES: That was Harvard Business School professor emeritus Lynda Applegate – in conversation with Brian Kenny on Cold Call. We’ll be back next Wednesday with another hand-picked conversation about leadership from the Harvard Business Review. If you found this episode helpful, share it with your friends and colleagues, and follow our show on Apple Podcasts, Spotify, or wherever you get your podcasts. While you’re there, be sure to leave us a review. We’re a production of the Harvard Business Review – if you want more articles, case studies, books, and videos like this, find it all at HBR.org. This episode was produced by Anne Saini and me, Hannah Bates. Ian Fox is our editor. Music by Coma Media. Special thanks to Maureen Hoch, Adi Ignatius, Karen Player, Ramsey Khabbaz, Nicole Smith, Anne Bartholomew, and you – our listener. See you next week.
