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Bootstrapping Using Services: Sylvana Caridi Coche, CEO of Gravity Pro (Part 4)

Posted on Thursday, Jan 26th 2017

Sramana Mitra: What is the business now? Do you sell mostly licenses?

Sylvana Caridi Coche: I switched from 80% services and 20% license to 80% license and 20% services. The goal next year is to do more and more services.

Sramana Mitra: How many people do you have now?

Sylvana Caridi Coche: I have three employees.

Sramana Mitra: This license-selling is something that you can do with very few employees. How profitable is the business?

Sylvana Caridi Coche: It’s very unique. Companies my size have, at least, 25 people between sales and management.

Sramana Mitra: Tell me a bit about how you do it.

Sylvana Caridi Coche: If you look at the services, I don’t have anymore consultants on my paper. The industry is moving so fast and the challenge of learning new technology is bigger. I don’t want anybody in my bench. All the consultants I take are updated. We sell a lot of cloud, mobility, cyber security, and Big Data. We focus mainly on that. For me, to be the best, the best way is to find the experts in the field. I can’t hire them because in two years, they might be obsolete when there’s a new technology coming up.

On top of that, I can match the culture of the consultant with the culture of the customer, which is very unique too. I understood that very early on. I make sure that people can work together. That’s my first rule when I do an implementation. They have to fit with the team. That’s the only way that we can do such a big and hard implementation successfully. Instead of having consultants, I basically have people who I know very well and who I look for. What I’ve done is we have agreed per industry and per product. We find the niche that people are best at. When I want to go and sell something, I can bring them with me. When we need to implement, they know the people.

Sramana Mitra: You’re doing an overlay of expertise Salesforce plus consultants who are not on your payroll but who come with you to help you sell, and then they get the service projects.

Sylvana Caridi Coche: No, I do the service projects.

Sramana Mitra: But you said that you don’t do as much service work anymore.

Sylvana Caridi Coche: Yes. That’s why I’ll be doing more service next year. I have my own methodology. Customers usually trust me and my team more than the others. One thing that’s also very unique is we can prime SAP services. Usually SAP asks you to bring people under them. We have an agreement where we can prime and they can come under us. I can bring on several partners but I can also include SAP if it’s something that they need to be involved.

Sramana Mitra: I need one clarification. This $30 million in revenue, does that include all the SAP licenses?

Sylvana Caridi Coche: Yes.

Sramana Mitra: What is the margin on this business?

Sylvana Caridi Coche: The margin on license is not that big but because I do volume and I have a very small infrastructure, it’s very profitable.

Sramana Mitra: If you were to take the gross margin out of the licenses, what is the actual revenue because the actual revenue is not the revenue with the licenses included?

Sylvana Caridi Coche: The revenue is coming to me.

Sramana Mitra: The revenue is coming to you mechanically.

Sylvana Caridi Coche: As with any VAR, that’s our job.

Sramana Mitra: What is the VAR commission? What is the business?

Sylvana Caridi Coche: It depends on the product. It varies from 13% to 40%.

Sramana Mitra: Let’s say average 20%. Your real top line is $6 million. When we look at businesses that are selling other people’s products, we really look at the money that you are making. You can call it revenue. You’re right. From a VAR point of view, it is called revenue, but a large percentage of that money goes to the OEM. You asked me what I liked about your company. Now that I have talked to you, I think that you’re a kickass entrepreneur and I love that.

Sylvana Caridi Coche: 50% of my time I spend on sharing my story so I can motivate other people and tell them that with my background with illiterate parents, with a laptop, in a country that’s not mine, you can do it. I even got an award from Hillary Clinton for Leading Entrepreneur for STEM.

Sramana Mitra: Fantastic, congratulations!

Sylvana Caridi Coche: Thank you.

Sramana Mitra: It’s very nice to meet you. Thank you very much.

This segment is part 4 in the series : Bootstrapping Using Services: Sylvana Caridi Coche, CEO of Gravity Pro
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