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A $14M Bootstrapped Family Business in Eugene, Oregon: Palo Alto Software Founder Tim Berry and CEO Sabrina Parsons (Part 5)

Posted on Monday, Jul 23rd 2012

Sramana: Did you take a revenue hit from 2007 to 2009?

Sabrina Parsons: We took a small hit, but it was not that much. We really focused on our core strengths online. We did not start building the new SaaS application at the time that we wanted to simply because we did not have the budget to hire the developers we wanted at that time. Our revenue dropped by a couple hundred thousand dollars, but it could have been far worse. Focusing on our core products kept us on track.

Sramana: When did things start stabilizing for you?

Sabrina Parsons: Things started stabilizing again around the end of 2009. Our fiscal year starts October 1. We decided at that time that if we could get to January 2010 with positive numbers, we would start our development process again and hire the development team. When January rolled around, things were positive, so we appointed someone to be the VP of product development and he started building his team. In April 2011 we launched LivePlan. It has been on the market for 14 months, and it continues to grow 20% in revenue month after month.

We now have a development team that is 15 strong that works only on the LivePlan product. That is the feature of our company. We use agile development with a Scrum methodology. We have a four-week sprint process. Every four weeks we release new features. That was our dream and vision in April 2007. The economy pushed our plans back a bit, but now in 2012 we are right where we want to be. We are expanding our reach beyond small business planning and into small business management as well.

Sramana: What percentage of your revenue does LivePlan account for?

Sabrina Parsons: Close to 60% of our revenue. It brings in more revenue than our Windows products. It is still growing and continuing to increase revenue. Business Plan Pro is currently being certified for Windows 8. It still has a future, but we feel that SaaS is the future of applications. People want to log in from anywhere and use a secure SaaS application.

Sramana: What is your pricing?

Sabrina Parsons: Business Plan Pro has two editions. The premier edition is used by consultants and advisors and entrepreneurs who are seeking investment. That is $199. The standard edition is $99 dollars. LivePlan is $19.99 per month for two concurrent users.

Sramana: In terms of the number of customers, how many are using LivePlan and Business Plan Pro?

Sabrina Parsons: We know that more than one million people have purchased Business Plan Pro since 1995. LivePlan has been available for purchase since April 1, 2011. We have more than 40,000 paying accounts. We are adding about a thousand paying accounts per week to LivePlan.

Sramana: What is your 2011 revenue situation?

Sabrina Parsons: It was a transition year from Windows software to the SaaS model. We definitely were strategic in how we transitioned. There could have been cash flow issues in that transition. We were up slightly in revenue. We are planning to hit $14 million in revenue in 2012. We know we can’t sustain huge growth forever, but we think growth next year is entirely feasible.

This segment is part 5 in the series : A $14M Bootstrapped Family Business in Eugene, Oregon: Palo Alto Software Founder Tim Berry and CEO Sabrina Parsons
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Thanks for sharing this story! It holds the key for many start-ups on several levels. Be willing to dig in for the long term – this business success did not happen overnight and I appreciate hearing the entire story. Be open to new technologies and new business models that can put your product in front of your market – hearing the transition from the original templates to the Live Plan is incredible. Find great people and let them go inside your company as it can be a huge benefit for the long term – kudos to Sabrina for her changes and enhancements!

Malla Haridat Monday, July 23, 2012 at 12:49 PM PT