Sramana Mitra: How big was that deal with Marriott?
Kevin Groome: At that time, not that big. It was less than $100,000 a year. They are now our largest client. They spent probably $30 million with us.
Sramana Mitra: $100,000 for a small company year-over-year is not a small amount of money.
Kevin Groome: Yes, we had a champagne dinner. Right from the beginning, we thought that Marriott would not work with a company as small as us. When they chose us, it changed our world.
Sramana Mitra: That’s a massive win. What was the next major win?
Kevin Groome: In my memory, the one that comes to me next is another major brand name. It was in the fitness business. It was Gold’s Gym. Gold’s Gym has this proud history. They had a really lovely marketing department that was trying to do a beautiful brand campaign executed through 600 or 700 locations.
The owners of these locations weren’t necessarily attuned to the finer points of advertising. It was created by this beautiful agency called McKinney. It was top notch work. You had to take this jewel and put it in the hands of these franchisees and hope that they understood what they were working with.
The Director of Marketing fought hard to get everybody to understand. Lo and behold, it worked. It was not SaaS yet. What we learned was invaluable. It taught us about so many different things, especially about making marketing materials easy for a non-professional to produce.
Gold’s Gym had to be more responsive than Marriott had to be because it was a smaller number of franchisees who were really vocal. If you’re a Marriott property, you have to do what the master brand tells you to do. At Gold’s, the power balance was a little different.
That was a great training for us. They were with us for at least nine years. Their management changed. That one was definitely where we began to see that we can do this and make it repeatable.
Sramana Mitra: Based on what you’re telling me, the franchise business model is good for you because people have the problem of having to control the brand across the franchise. That’s a great scenario for your type of application.
Kevin Groome: You nailed it. I just got out of a marketing meeting today. In our company, staff turnover from time to time. You find young people who don’t have this long history. They are recognizing that franchise is a place for us to be.
We solve the problem that franchise organizations struggle with. We began to execute on that insight. In the next few years, we began to add customers with greater pace. That was a challenge. The software was still custom.
We began drowning in our own complexity. We had so many customizations that we found ourselves putting out fires all the time. I didn’t detect the pattern swiftly. I think the devs could tell.
It was about then that we got our first investment. We bootstrapped the company from its founding until we got to 2007 when we realized that we wanted to make this into a platform product.