Why Appian's Location Is a Hidden Advantage

Unlike most tech companies, Appian (APPN -1.25%) is based in Northern Virginia. In this Backstage Pass interview, aired on Nov. 24, Appian CEO Matt Calkins explains why he sees that as an advantage and how it helps differentiate the company from its peers.

Jeremy Bowman: Another unique thing about your company that people might not know is that you guys are based in Northern Virginia. Not too far from Fool HQ and I know the Fools, I know the Gardner brothers have used that as a way of distinguishing themselves from Wall Street and obviously the tech industry is based in Silicon Valley. I wonder how being where you guys are has influenced you and how you think of that?

Matt Calkins: That's a cool question, and I think you're onto something. I think they and you are onto something and we believe it too. That by being away from the center of your industry, you're able to be more differentiated. You can take a different course, you don't have to fit in with a larger paradigm. You can be iconoclast, Appian is in a iconoclast. We like to think for ourselves, come up with our own values, write our own rules, attack the market we see as most valuable, try to create value where others didn't expect it. I think it gives us some latitude to be different than who we would be expected to be, and we compound that advantage, or that freedom, to be differentiated by the fact that we are a bootstrap and still therefore not really a vehicle of our investors or our quarterly guidance. We're capable of doing something unexpected, and that is to our advantage.

A lot of businesses have left behind their ability to really be creative, to create new patterns. Let me just give you a quick example. We tried this year to launch a new pricing strategy that I don't know that anybody has ever tried in our industry. This strategy says that we'll allow a customer to subscribe to all the applications they can build within a year on our platform. We agree and advance with what the price is and then they have every reason to build as many applications as they can, because they're all free on the margin at that point. It encourages them to rapidly adapt to our software and train to be good at it and make the most of the entire year. And the advantage they get is, it was a good deal. We align our interest with our customers, this might have been difficult to do if we've been in Silicon Valley or we've been controlled by a typical board. "That's a weird idea. Why are you doing it? Who's example are you following?" Well, we didn't follow on example, we just thought this would be a good way to help the customer and align our interests and so we're giving it a try. I love it when Appian does things like this, we're willing to be creative. We're willing to try something, and whether it's a big success or a learning experience, I don't know. It looks pretty good so far, but we're willing to try things like that, and I believe that if you are away from the center of your industry, you've got a little more flexibility to be like that.