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Thought Leaders in Big Data: Omer Artun, CEO of AgilOne (Part 5)

Posted on Sunday, Dec 2nd 2012

Sramana Mitra: What kind of competition are you seeing on the market? I know there is a lot of activity in the data space right now, and everybody wants to be categorized on their big data these days. It sounds as though you have relatively mature capabilities since you have been in business for seven years working with real customers. What do you consider as real competition?

Omer Artun: There are three types of competitors, but we don’t touch them; we don’t really compete with them. There are IBM and Teradata. But we don’t play in that phase, they are very high-end. They go after millions of dollars [worth] of opportunities. It is more of an install-type issue, and they are not cloud based. But they have similar capabilities and they try to solve a similar problem. The IBM smart commerce initiative is similar to what we do. The second type of competitor we have are the marketing service providers. These are companies that work with service models and cobble [together] technologies from different vendors, which again deal with on-premise solutions or custom solutions. These are companies like Axiom, Experian, or Miracle Exelon. Again, we are not competing with them for the market we are going after because they are very high-end as well, and they take 6 to 18 months to install. They are running in a custom environment. We are much more agile – 6 to 12 weeks’ implementation – and we are going after mid-market companies. The last type of competition we have are the internal IT people who try to help the marketers themselves by buying point solutions and trying to stitch them together.  Among other cloud members we don’t see any competition yet, but we believe it is going to come.

SM: You mentioned earlier that you were in business for six years before you actually raised money from Sequoia. How big was your company before you received funding?

OA: We were about 45 people and were profitable.

SM: Could you give me a revenue range?

OA: It is between $5 million and $15 million.

SM: That is interesting. Our program is a big believer in bootstrapping. We always love stories where the serious successful bootstrapping phase of the negotiating power ends up being in the hands of the entrepreneur. Reading between the lines of your story, I guess this must have been your experience.

OA: When I started the company, in the first year, we had approximately $300,000 of revenue. The second year we went to much more than that. But it was very stressful. The first year you ask yourself questions like, “Am I stupid? Is this a good idea?” The second year you start asking yourself if you can hire a couple of employees and make it a real and viable business. In the third year you go into the gross mode and you ask yourself if you can hire an office manager and an accountant, etc., and then it goes from there. The first two years are a lonely phase. It is hard.

SM: The advantage of this model is that you get to validate your assumptions. You get to work with your own customers and get a sense of what the business that you are building really is. Often you start with a hypothesis, and that hypothesis needs to be tweaked a lot before you hit the model. Sometimes where you start is not where you end up. Doing that kind of experiment with investor money is very expensive.

OA: It really is. I remember sitting by myself for the first six months with no employees and calling up companies, trying to convince them to give you me money. They said, “Have you done this before? How many people do you have? How long have you been in business?” And I had to say, “I have zero employees, I have never done this before, and I have been operational for three months.” You need to have something really special to get those first couple of contracts.

This segment is part 5 in the series : Thought Leaders in Big Data: Omer Artun, CEO of AgilOne
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