Sramana Mitra: How many enterprise customers were you able to gather as paying customers to get to this million dollar annual revenue?
Robert Hoehn: I think it was about 50 enterprise customers.
Sramana Mitra: How were you selling? Were you selling on the phone? How were you going to market?
Robert Hoehn: I did it all on the phone.
Sramana Mitra: How many people were in the company at this point?
Robert Hoehn: There were about eight or nine, I think.
Sramana Mitra: What happens after 2012?
Robert Hoehn: We continued to grow and continued to pivot into the enterprise space. Around mid to late 2012, the government business was actually doing pretty well. We learned a few interesting things. By then, we had started charging government projects.
Sramana Mitra: I was about to ask you that.
Robert Hoehn: It was growing and we decided that we wanted to have an office there and have someone full time. We opened an office there and we started focusing on learning more about the intricacies of government around purchasing, deal sizes, and RFPs. We learned quite a bit. One of the big things was working with the GSA to actually create a listing so government agencies can easily hop in and buy IdeaScale. That was a huge advantage for us.
Sometimes, it can take a year and a half to get listed or longer. We also learned a lot about word-of-mouth publicity. We started to get pretty aggressive with writing stories and case studies and sharing them for free with anyone who would read it. DC is a small circle. If one agency is using a tool and it’s working, they will all start using it. That worked to our advantage. We did everything we could to get the word out there as fast as possible.
Sramana Mitra: How big did the government business grow to?
Robert Hoehn: Around 2013, it was about 20% of our business. Today, it’s about 45% of our business.
Sramana Mitra: Wow! That really became a significant strategy.
Robert Hoehn: Also, around 2014, we started to aggressively talk to governments in other countries. We learned a lot about international conventions. I think it’s really fascinating, especially for bootstrapped companies because there’s a lot of ways now where you can have a footprint in other countries for a pretty low cost.
Sramana Mitra: At what point did you start your international business?
Robert Hoehn: 2014.
Sramana Mitra: If your strategy is primarily selling through the phone and you’re using Google AdWords or SEO to generate leads, that can be done internationally very easily. We have a lot of companies in our portfolio in distant parts of the world that do it internationally. They are essentially running global businesses.
For enterprise, if you have to actually go visit and sell large deals, that’s when international expansion takes a very different operational framework. But if you’re doing lead generation through Google and other online lead generation mechanisms, then you can do it anywhere.
Robert Hoehn: When you’re selling to enterprise, there’s traditionally an expectation that you would show up face-to-face and talk. That’s still difficult for us. We do our best to try and visit everybody we can and do it as efficiently as possible. It’s a challenge especially for older, large enterprises. I’ll be the first to admit that we probably lost a few deals because someone asked us to come and present and we just couldn’t do it. Some people, culturally, are still put off by that.