Bootstrapping to $100 Million: Vacasa Co-Founder Cliff Johnson (Part 5)

Sramana Mitra: 35% commission on the rent that you collect and then cleaning fees to cover the cost of housekeeping the properties.

Cliff Johnson: Yes, that’s just for cleaning. We have a local operations manager in each market. That person takes care of the properties. They typically have about 20 properties in their portfolio. They are the main contact for the home owner. That model has helped us make sure that we take care of the properties.

Having that person in place, of course, is a salary expense. Right now, we have approximately a thousand employees. The bulk of those employees are housekeepers, some of which, are part-time. We also have a full development team that’s creating our software and making adjustments to the software to improve our service. We have an analytics team and a finance team. We have a large operations team for business development and human resources as well. >>>

Bootstrapping to $100 Million: Edifecs CEO Sunny Singh (Part 6)

Sramana Mitra: When you look at the journey, first and foremost, it’s fascinating and congratulations for staying with it. I would say the main determining factor between success and failure is staying power. You described two points where you stood there looking in the mirror. That was a very critical point where if you chose to go work for Microsoft and took the easy way out, today would have been a very different day. You did stay with it and you did keep the team.

My takeaway from your story as well as from a lot of stories I’ve heard is staying power and the commitment to stay is one of the determining factors of success in a lot of entrepreneurs’ journeys.

Sunny Singh: I don’t think I’m any smarter than the next guy. Actually, I’m not. The fact is it’s about the choices you make. I’ve friends who made choices and they are where they are today. I made my choices and I am where I am today. That’s what I tell my kids but not formally so. I want them to decide what they want to do. I don’t want to tell my kids what they should be. I don’t want to tell my colleagues what they should >>>

Bootstrap First, Raise Money Later from Utah: HireVue CEO Mark Newman (Part 2)

Sramana Mitra: Was it a direct selling model? Were you selling directly to the hiring departments of these companies?

Mark Newman: Yes, that has always been the business model.

Sramana Mitra: What is the business model?

Mark Newman: At that point in time, we used to charge per interview. Four years ago after a lot of our hard costs were taken out of our cost model, we converted to a subscription model. Things like shipping webcams went away with the ubiquity of mobile phones. We were able to convert to a full subscription model.

Sramana Mitra: What’s in the product? On the surface, doing a webcam interview, you can do it on Skype. You can even do it on FaceTime. What’s special with HireVue? >>>

Bootstrapping to $100 Million: Vacasa Co-Founder Cliff Johnson (Part 4)

Sramana Mitra: So far, what I’ve gathered is that you pretty much self-financed the business and grew organically. You started in Oregon within a range where you and Eric could service all of the work and gradually built out the service provider network to scale it. Can you talk about the ramp? How many properties were you managing in, say, 2010 to now? How did the inventory of properties evolve or grow?

Cliff Johnson: Right now, we manage approximately 2,300 homes. We started with one back in March of 2010. We’ve consistently grown at least two to four times every year. At the end of the first year, we were at a point where we had grown to have 56 properties. At that point, we knew we were viable. One of our goals when we started the company was to have 50 full-service properties. >>>

Bootstrapping to $100 Million: Edifecs CEO Sunny Singh (Part 5)

Sramana Mitra: You were doing what kind of revenue level now?

Sunny Singh: In 2008, we were about $8 million to $10 million.

Sramana Mitra: In 2006, you’re back in a healthy state. What’s the next major development?

Sunny Singh: In 2001, when all this was going on, we came across this mandate from the government called HIPAA where all healthcare transactions had to comply with HIPAA standards. We entered healthcare but we didn’t have any idea about it or how it works. We just focused on taking on one customer at a time and making them successful. Before you know it, after five to seven years of good traction, healthcare companies started loving us. We had new approaches to solving problems. We were very customer-centric and our products were really good. From 2006 onwards, from being an EDI tools company we went on to become a products company because we started doing production transactions. We pivoted again to healthcare by supporting HIPAA. Then, we pivoted again by selling more of providing services starting 2007 to 2008. We started building out that competency. >>>

Bootstrap First, Raise Money Later from Utah: HireVue CEO Mark Newman (Part 1)

True to our 1M/1M mantra, Mark bootstrapped HireVue to $1M in revenue before raising the first funding. Today, the company has raised a total of $92 million, and is going $30 million in revenue. Excellent case study to study!

Sramana Mitra: Let’s go to the very beginning of your story. Tell us where you’re from, where you were born and raised, and in what kind of circumstances.

Mark Newman: I was born in Northern Canada, about 400 miles north of Toronto, in a small town called Timmons. I was a mining industry brat. My dad designed and built the copper smelters. He was a chemistry and metallurgy nut whose favorite thing was taking rocks and turning them into solid bars of something. Living up there, you were able to be blissfully unaware. You live in a small little town. You had chances to go to lakes and kick through trees.

Sramana Mitra: Where did you do your college? >>>

Bootstrapping to $100 Million: Vacasa Co-Founder Cliff Johnson (Part 3)

Sramana Mitra: Let’s go back to the beginning. In maybe 2010, how did you get the business off the ground? Did you guys use your own funds? How did you launch the company?

Cliff Johnson: We started with funds that Eric had saved in order to launch the business. We started with a relatively modest amount of funds, to be honest. Eric was still working full-time when we launched the company. I took a couple of other jobs to start this company with Eric. We were both working other jobs at that time. Soon after we started, we saw the opportunity. We were generating revenue shortly after we launched the site in March 2010. We just focused on reinvesting the revenue we had back into growth. Also, we were taking excellent care of the homes that we were bringing on.

We were fortunate that we’re in an industry where there’s not a high cost of goods sold. The barrier to entry is really what kind of system you can set up to manage this. Initially, the biggest obstacle was getting people to believe that we were real. When we started, we launched the company with one property. It was in Long Beach. We started with the idea of being a distributed model. We’re based in Portland, Oregon but Portland didn’t allow vacation rentals. >>>

Bootstrapping to $100 Million: Edifecs CEO Sunny Singh (Part 4)

Sramana Mitra: While it wasn’t a small company, it wasn’t one of the major companies – SAP or Oracle.

Sunny Singh: That’s right.

Sramana Mitra: What were the contract sizes of the projects you were doing?

Sunny Singh: Under $2,000. They were all between $500 and $2,000. It depends how many seats they buy. If you bought more seats, you pay more.

Sramana Mitra: Early on, how did the revenue track? What was the revenue ramp like?

Sunny Singh: Around 1998 to 1999, we were a sub-$2 million company. We were doing a couple of projects. We were doing one contract where we were helping develop format for processes. >>>