HBR On Strategy: How to Turn Your Customer Base into a Community

Episode Release Date: April 23, 2025
Host: Harvard Business Review
Guest: Matt Mullenweg, Founder and CEO of Automattic (the company behind WordPress)
Transcript Highlights: [02:18] – [17:57]

Introduction

In the April 23, 2025 episode of HBR On Strategy, Harvard Business Review delves into the transformative power of building communities around businesses. Hosted by Amy Gallo and Amy Bernstein, this episode features a compelling conversation between Matt Mullenweg, the visionary founder and CEO of Automattic, and HBR IdeaCast host Sarah Green Carmichael. They explore how fostering a strong community can drive long-term success for businesses, both internally among employees and externally with customers.

The Centrality of Community in Business Strategy

Matt Mullenweg opens the discussion by emphasizing that "everything that has been successful for WordPress in the past and everything for Automattic has really been part of thinking about what's the best long term answer for the wider ecosystem" ([02:18]). For Mullenweg, community isn't just a buzzword but the foundational element of a sustainable business strategy. He believes that by prioritizing the interests of the community—comprising users, developers, and integrators—companies can align their commercial interests with the well-being of their community members.

"For me, it all starts with community. That's really the beginning, the alpha and the omega." – Matt Mullenweg ([02:18])

Maintaining Company Culture During Rapid Growth

As Automattic scales both its user base and employee count, maintaining a cohesive company culture becomes paramount. Mullenweg shares insights on balancing rapid growth with cultural integrity:

"I think it's just a rate. ... The culture has nothing to do with ping pong tables ... it's really the culmination of a thousand little decisions and actions." – Matt Mullenweg ([04:22])

He highlights the importance of setting examples from the top. Simple actions by leadership, such as maintaining cleanliness or demonstrating responsible behavior, set the tone for the entire organization. This approach ensures that as the company grows, new hires embody the established values without the need for superficial perks.

Hiring Through Auditions: A Unique Approach

Automattic distinguishes itself in the competitive tech landscape by adopting an unconventional hiring process—auditions instead of traditional resumes. Mullenweg explains:

"In fact, I still to this day refer people to the HBR article. ... The more trials we do, the more times we run the process, I feel like the more people learn about it and the better they get." – Matt Mullenweg ([06:16])

This method allows candidates to demonstrate their skills and cultural fit in real-world scenarios, ensuring that new hires are not only technically competent but also aligned with the company's ethos. As the company has grown to 390 employees, this approach has scaled effectively, fostering a workforce that is both skilled and culturally cohesive.

Building Customer Communities: Trust Over Control

One of the critical challenges for businesses is transitioning from a customer base to an engaged community. Mullenweg uses an insightful analogy to illustrate this balance:

"If you were hosting a dinner party, you would put out the snacks and the hors d'oeuvres ... people help out with the dishes out of appreciation. ... It works best when there's no expectations." – Matt Mullenweg ([07:26])

He argues that providing substantial value upfront—like high-quality, free software—encourages customers to invest back into the community organically. This trust-based approach fosters genuine engagement, as customers feel appreciated and are more willing to contribute without coercion.

The Freemium Model: A Double-Edged Sword

Transitioning into business models, Mullenweg discusses the freemium model, where a basic product is free to use, with premium features available for purchase:

"WordPress is relatively inexpensive to run for people, and so it doesn't cost us a ton to have people use it for free. ... The more stuff you put in the free, the more value it is, the more growth you have." – Matt Mullenweg ([10:41])

While the freemium model can drive significant user acquisition, the challenge lies in balancing what features are free versus premium. The premium offering must provide compelling additional value to entice users to upgrade, ensuring the model's sustainability.

Beyond Advertising: Exploring Alternate Revenue Streams

Addressing the limitations of traditional advertising, especially dominated by giants like Google and Facebook, Mullenweg suggests a hybrid revenue model:

"I wouldn't bet my business on advertising. ... If you can have a hybrid model ... providing enough value to your core audience that they're paying you directly, I think that can be very sustainable." – Matt Mullenweg ([12:41])

He envisions a future where connected devices and ambient technology create new avenues for monetization, moving beyond intrusive ads to more integrated and value-driven revenue streams.

Personal Productivity Insights

Shifting gears, the conversation touches on personal productivity strategies employed by Mullenweg:

"Tiny habits ... two sun salutations when I wake up ... read a chapter of a book every day." – Matt Mullenweg ([15:56])

He emphasizes the importance of mindset over sheer output, advocating for practices like deep breathing to enhance mental clarity and reduce reactive behavior. This holistic approach to productivity underscores the interconnectedness of personal well-being and professional efficiency.

Conclusion

The episode concludes with a reflection on the seamless integration of community-centric strategies in both business operations and personal practices. Matt Mullenweg's insights provide a roadmap for businesses aspiring to build and nurture robust communities that drive sustained success. By fostering trust, maintaining cultural integrity during growth, and exploring innovative revenue models, companies can transform their customer bases into vibrant, engaged communities.

Key Takeaways:

• Community as Foundation: Building and prioritizing a community leads to long-term business success.
• Cultural Integrity: Maintaining company culture is achievable through consistent leadership examples and thoughtful hiring practices.
• Trust-Based Engagement: Providing value without strings attached fosters genuine customer engagement and loyalty.
• Balanced Business Models: Freemium and hybrid revenue models can be effective when strategically implemented.
• Personal Well-Being: Integrating personal productivity habits enhances overall professional performance.

Notable Quotes:

• "For me, it all starts with community. That's really the beginning, the alpha and the omega." – Matt Mullenweg ([02:18])
• "The culture has nothing to do with ping pong tables ... it's really the culmination of a thousand little decisions and actions." – Matt Mullenweg ([04:22])
• "If you can have a hybrid model ... providing enough value to your core audience that they're paying you directly, I think that can be very sustainable." – Matt Mullenweg ([12:41])

This detailed exploration of community-building strategies offers invaluable insights for business leaders aiming to transform their customer relationships into enduring communities. Whether you're a startup navigating early growth or an established enterprise seeking deeper engagement, Matt Mullenweg's experiences with Automattic provide a compelling blueprint for strategic success.