According to a 2014 Accenture report, the global market for electronic health records (EHR) is projected to grow to $22.3 billion in 2015. North America is expected to remain the biggest region in the industry, growing 7% annually to bring in $10.1 billion. Westborough, Massachusetts-based eClinicalWorks is a growing force in the industry and a proud member of the Billion Dollar Unicorn club member. What’s more, the company was bootstrapped with a paycheck.
I have started 2015 with the launch of a new book called Billion Dollar Unicorns. Writing this book took me through the extensive process of talking to entrepreneurs who have built tech companies with valuations above a billion dollars. While there is a tremendous amount of serendipity involved in any extraordinary success story, one recurring theme comes up in these case studies. I am particularly excited to share this nugget because it applies broadly to all classes of entrepreneurial ventures.
Bootstrap first, raise money later.
That’s what Fred Luddy did when he founded ServiceNow back in 2005. Leveraging his domain knowledge and expertise in IT ServiceDesk software, he rapidly acquired 12 customers before raising funding. Initially, he started charging $25 per seat and the 12 customers paid up. He raised $2.5 million in venture capital WITH 12 customers, and ample validation.
Sramana Mitra: You have described the user experience from the consumer’s point of view. Can you explain the engineering of this? What’s going on where?
Luke Schneider: What seems simple on the surface is complex on the inside. It required us to solve a lot of problems. One of the reasons why we chose Audi is that each vehicle has a controller area network in it. There is literally, in case of an A4, about seven controller area networks running everything from the power train to the entertainment system. With a simple piece of hardware that plugs into a 10-pin connector, we tap into that network. It communicates with that car through a phone. At the same time, we’re communicating with cloud servers over wireless. Essentially, that’s how that customer is able to access their vehicle. That’s the iceberg analogy. >>>
Sramana Mitra: Where is the position? This is not in Cincinnati, right?
Stuart Frankel: It was in Chicago. I had met a woman who I’m married to now. She was originally from New York. She was living in Cincinnati as well. We were also figuring out, from a life standpoint, where we wanted to be. In addition to presenting this career opportunity, Chicago was also a great place to live for us. We moved to Chicago and got married. I started my job at rollingstones.com. It was a fairly typical Web 1.0 experience. It was obviously a very exciting opportunity. We had brand name. It was a relatively high profile company. I had a really interesting job that pushed me professionally. I was doing a lot of things that I had never done before. >>>
Entrepreneurs are invited to the 251st FREE online 1M/1M roundtable mentoring session on Thursday, March 5, 2015, at 8 a.m. PST/11 a.m. EST/9:30 p.m. India IST.
If you are a serious entrepreneur, register to “pitch” and sell your business idea to Sramana Mitra. You’ll gain straightforward feedback, advice on next steps, and she’ll answer any of your questions. Others can register to “attend” to watch, learn, and interact through the online chat.
There are several Billion Dollar Unicorn club members who have taken their time getting to the club. But there are a few stories of startups that have sped their way to the club. Here is one such interesting player, two-year-old team communicating service Slack, which is making waves in the market.
Sramana Mitra: So you’re not a founder of Edmunds?
Avi Steinlauf: I’ll tell you a little bit about the history of Edmunds. I think you’ll see it interwoven with some of the things that I’ve mentioned earlier. Edmunds is a majority-owned family business. It’s my family. My father, Peter Steinlauf, who is our active Chairman, was a serial entrepreneur. He built up outdoor advertising business in the ’70s. Then there was some industry consolidation in the 1980s. He sold his business and was looking to get into another business.
He came across this small print publisher called Edmunds that published quarterly pricing guides for new and used cars that were sold in bookstores and in news stands. He went ahead and bought the company. At that time, there were a handful of employees based in Long Island. >>>
Some of what you’ll read in this interview will seem like science fiction. But please read on!
Sramana Mitra: Let’s start at the very beginning of your personal journey. Where are you from? Where were you born and raised, and in what kind of circumstances?
Stuart Frankel: I was born in Cincinnati, Ohio. I was the middle kid with a sister on each side. I went to public high schools and ultimately to Miami University in Oxford, Ohio, which is about an hour from Cincinnati. I started as an Economics major but ended up being an accounting major. Then, I moved to Chicago and became a CPA and worked for PricewaterhouseCoopers for the first few years of my career.
Sramana Mitra: In terms of chronology, what years are we talking?
As you may know, we just launched a book called Billion Dollar Companies profiling the journeys of entrepreneurs building massive businesses. Edmunds.com may just be another unicorn.
Sramana Mitra: Where does your journey begin? Where are you from? Where were you raised and in what kind of circumstances?
Avi Steinlauf: Originally, I was born in London, England. For those folks from the UK or familiar with the UK, I’m a cockney by right given the fact that I was born within the sound of the Bow Bells, even though the accent that you hear is nothing like an English accent. I really grew up here in Southern California and spent most of my schooling here in the United States. >>>
Peer-to-peer lending platforms are seeing a strong opportunity in small business and retail consumer financing markets. Analysts estimate the small business loans market to be a $300 billion market. They also estimate the credit card refinancing market to be a $800 billion market. Billion Dollar Unicorn club member Lending Club is among the largest player in the peer-to-peer lender category.