Sramana Mitra: Let’s talk about what happens after you did the reset. What was your go-to market strategy with the new horizontal product?
Brad Peters: We had to sit down and figure out what the go-to market strategy was going to be. There was a lot of experimentation. We couldn’t make our enterprise product available to everybody from day one. So we had to pick a small piece of it and make that available. It was not able to satisfy the entire market. We had to find little pieces of that marketplace that we could grow, expand, and drive. We tried a lot of value propositions – some of which worked, many didn’t. Ultimately, as we kept building the product and getting it richer and more robust, we continued to put more enterprise capabilities into the product. As we ultimately got those enterprise capabilities into the product, we started to compete in that main market. It was late 2010 when we really nailed it and things started to click.
Sramana Mitra: What conclusion did you arrive at which made things click after all these experimentation?
Brad Peters: It wasn’t one conclusion. There may be a lot of businesses out there where they figure one thing out. For us, we had to figure out a blend of things. We had to figure out different ways of going to market. We had to figure out how to price it. We had to figure out where our sweet spot was in the marketplace relative to others. We had to build the value proposition for specific market segments. We had to hire the right sales people. We had to hire the right profile of people.
Sramana Mitra: Let me ask a couple of specific questions that will answer what I’m trying to get at. You were going to market with a horizontal product. Nonetheless, my experience of bringing horizontal products to market is use vertical segmentation and go after specific verticals where that horizontal has good applications and ability to generate ROI. Even though you’re going to market with a horizontal product, you still need a vertical market approach. Is that your observation as well?
Brad Peters: I think that’s the Geoffrey Moore model and that model works fine in certain segments. Historically, that’s not how the analytics market has worked. If you think back to companies in our segment that have been successful, there have been vertical concentrations in some things but analytics is one of those areas where it’s very broad in its ability but also diffused. It’s hard to pick a single vertical to be successful in. You’re finding more functional areas and creating functional value propositions and you’re going wide. That’s the challenge. It’s very rare for a company in the analytics space to jump to vertical two. It just doesn’t happen.
Sramana Mitra: That’s not what’s happening in the Big Data space. We’ve done case study after case study in Big Data. Almost everybody is going with the vertical approach. Many of them are doing really well including some of the Sequoia companies.
Brad Peters: It depends on whether you’re selling a platform or an application. If you’re Cloudera, you’re selling horizontally. If you’re Medallia, you’re selling vertically. It depends on what you’re trying to sell. The ones who are going vertically typically focus on one vertical. If they hit a gusher, that’s great. Our core technology was not centered on a specific vertical. Our core technology was around the BI market in the same way that Salesforce and Netsuite was horizontal. There were places that tended to buy them more than others and we’ve had the same thing.
We had to figure out the roles in organizations who are the most applicable for us to develop discreet value propositions. There are certain roles that companies at the right size that deal with us care about. The sales roles are key. Anybody who runs a sales organization needs sales data. There are a bunch of roles that would make a ton of sense. What we’ve developed was a set of different messaging for each of those particular roles so we could go in and explain to them why we are relevant to them. We also didn’t take IT head on which is where much of the market had been. We started out originally going with line of business, focusing on specific business problems and specific functional segments.
Where we found a lot of traction was around places where analytics tends to be based on the data source. A lot of the center of gravity for an analytics company is the data source. We focused around a variety of enterprise applications that had a lot of data. In the same way that Siebel needed Siebel Analytics. Salesforce needs analytics. Even SAP and Oracle need analytics around them. We focus on how to tell discreet stories to each of those folks so they could understand why analytics would be helpful to them and why Birst was the right vendor to partner with.