What next for Scott Farquhar, the godfather of Australian tech?

For more than two decades Scott Farquhar and his Atlassian co-founder Mike Cannon-Brookes have been the most important duo in Australia’s burgeoning technology sector. Now Farquhar is going it alone, announcing that he will step down as co-chief executive of Atlassian.

It’s not a stretch to say that what the entrepreneur does next will help determine the future success of the local industry, which has billions of dollars and thousands of jobs riding on its back.

Atlassian co-founder Scott Farquhar has resigned after 23 years.

Farquhar is just 44, has a cashed-up venture capital vehicle and an interest in fostering new generations of talent. “After 23 years, it’s time to pursue some other passions I have,” he told investors on last month’s earnings call. “Specifically philanthropy, investing, and to help grow and build the global technology industry.”

Farquhar announced his surprise departure from Atlassian in April, ending a 23-year career steering the company from a small, scrappy enterprise software firm into what is now the nation’s largest technology outfit. His last day is August 31, after which he will remain as a board member and special advisor.

Rumours quickly spread that Scott and Mike had finally broken up; that the pair had fallen out. The truth is much more boring: running a large company is a vastly different endeavour to running a small one, and it’s common in tech start-up land for founders to move on after building up their business. For Farquhar, after two decades, that time has finally arrived. It’s time for his second act.

Atlassian may be counted as one of Australia’s largest companies but few among the general population know what it actually does. Most know of Scott and Mike. They’ve built reputations for being outspoken, socially and environmentally progressive Sydney billionaires who between them own some of the country’s most lavish real estate.

Atlassian’s products can be seen as the antithesis to the fun, quirky design software produced by Sydney stablemate Canva.

Atlassian’s Jira, Confluence and Trello are used by white-collar workers – mostly technology – to collaborate, organise work and develop software. It’s not sexy stuff but it’s important.

While Atlassian has grown into a globally significant business worth about $68 billion, its software used by most of the world’s largest companies, its biggest contribution to the technology ecosystem may not be the company itself.

As Farquhar told me in a 2021 interview, he likes to measure his impact by the entrepreneurs who leave Atlassian to start new ventures.

Risks and rewards

Atlassian has hired thousands of local engineers and tech workers over its two-decade existence – its headcount sits at a touch over 10,000 – many of whom are ambitious and will likely go on to start companies of their own.

Farquhar pointed to the infamous “PayPal Mafia”, of which PayPal founders and employees Elon Musk, Reid Hoffman and Peter Thiel were members. They went on to start Tesla, LinkedIn and Palantir, respectively. Farquhar is confident there’s an “Atlassian mafia” brewing.

Co-founder Mike Cannon-Brookes (right) will become Atlassian’s sole CEO, while Farquhar will remain on the board.

Already, multiple fast-growth Australian technology start-ups have sprung up from Atlassian’s ranks, including customer feedback company Dovetail, search enterprise Sajari and workplace communications provider Pyn. These companies were all started by ex-Atlassian employees and are part of the halo effect the company has on the industry.

“I couldn’t be more proud,” Farquhar said of his ex-Atlassian staffers in the interview. Farquhar declined to comment for this article through a spokesperson.

He is a mentor to some of the leaders of other billion-dollar tech businesses: Canva’s Mel Perkins and Cliff Obrecht consider him a close friend, as does SafetyCulture chief executive Luke Anear.

Anear, whose business itself is now worth almost $3 billion, says what started out as a mentorship became a friendship over time. “Building a business is lonely … there aren’t many people you can completely confide in, and Scott has been that person for me,” he says.

“Scott is many things to many people, but first and foremost, he is a family person. He cares deeply about his family, and even though they have had to make sacrifices to allow Scott to travel so much, he has set the example for balancing work and home life for the entire industry.”

As Anear puts it, of the Atlassian founders, Mike is the risk-taking visionary, and Scott is the more conservative realist.

“Scott is a nerd at heart, which means he goes deep on details. His knowledge of legislative frameworks and tax implications is as good as most specialised lawyers. He holds court with prime ministers and the highest dignitaries in the land, and his understanding of how technology can positively impact society is second to none.

“Without Scott, Mike, and their work at Atlassian, Australia’s technology industry would be a decade behind. It’s hard to quantify the tens of thousands of jobs, families, and lives that have benefited from Scott’s actions, but it’s fair to say that his impact on the world has been significant.”

Two heads are better than one

Farquhar’s impending departure also ends one of corporate Australia’s great experiments: could two best friends successfully co-parent a company?

The answer, for two decades, was a resounding yes.

Globally, the co-chief executive model has rarely worked. US tech giant Salesforce has tried it briefly twice, with Bret Taylor and Keith Block lasting only one year and 18 months, respectively, as co-chief executive to Marc Benioff.

Netflix’s co- co-chief executives Greg Peters and Ted Sarandos are a closer comparison to Farquhar and Cannon-Brookes, in that their personalities are dramatically different, but that’s what makes it work.

Farquhar and Cannon-Brookes have been joined at the hip for two decades – until now – but the way they operate is radically different, as were their upbringings.

Cannon-Brookes is the son of a wealthy Citibank executive, Michael Cannon-Brookes senior and Atlassian was started with the help of his credit card.

Farquhar, meanwhile, would some nights cry himself to sleep as a child because his parents couldn’t afford a computer. The tech executive may well have ended up an engineer in the army, if he hadn’t missed an acceptance letter from the Defence Force Academy.

Farquhar’s career-defining missive was instead an email he received from his then-UNSW classmate, Cannon-Brookes, in June 2001. It read: “Bored of studying, Atlassian is far more interesting.”

Cannon-Brookes had sent the email to a number of students in their business information technology course, but Farquhar was the only one to say “yes” to it.

Members of Australia’s investment circles are pondering whether Farquhar’s next move will be to join Cannon-Brookes in throwing his considerable political and financial weight around in the form of activist investing.

Despite balancing his time with Atlassian, Cannon-Brookes has become arguably Australia’s most successful activist investor. He is the largest shareholder in AGL through his family office Grok Ventures, as well as the Sun Cable project, which will develop solar farms to supply electricity to Darwin and Singapore.

He is also not shy of an opinion, appearing on ABC’s Q&A and regularly taking to Twitter to vent about politics or the environment, and occasionally getting into back-and-forths with Elon Musk.

Farquhar describes Cannon-Brookes as George Bernard Shaw’s Unreasonable Man: “The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.”

Not your usual “tech bro”

Farquhar is more the “Reasonable Man”. He’s less conspicuous, preferring to quietly work towards change. In our previous interactions he’s asked how my family’s going, given me directions when I’ve been lost at one of Atlassian’s conferences, or politely pointed out a typo in a story.

He doesn’t fit the usual “tech bro” mould that has become all too common, aside from perhaps his real estate portfolio.

Like Cannon-Brookes, Farquhar has a family office – Skip Capital – to help deploy his wealth. It is run by his wife Kim Jackson.

Jackson was once the keyboard player for alternative rock band Krill alongside her four siblings, before she took a role as an investment banker at Hastings Funds Management in Sydney.

Jackson and Farquhar in 2022 also successfully led a charge to turn elite Sydney boys school Cranbrook co-ed by the end of the decade.

Farquhar will be spending more time now on Skip, which funds long-term projects across wind, solar, waste processing and recycling through its dedicated infrastructure fund. It also makes investments in more typical software start-ups such as Canva and Culture Amp.

Many of the world’s most successful tech companies have survived and thrived thanks to venture capital, and Skip’s investments have the chance to make or break some of Australia’s next-generation start-ups.

Farquhar, who has three sons with Jackson, will be spending more time with his family as well as his family office.

“Scott now has the enviable position of being able to choose his destiny for the decades ahead,” says Anear. “Will he choose a much quieter, low-profile life focused on his family, or will he find an itch that he needs to scratch, so he can continue to learn and grow? Maybe he’ll do it all again.

“Regardless of the path he chooses from here, I have no doubt his values and caring nature will guide him to make the best decisions for himself, his family, and society.”

If the “Atlassian mafia” is emerging, then Farquhar is its godfather, and it’s highly possible that his second act could be just as consequential as his first.

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