Bootstrapping to $10 Million from Canada: Jory Lamb, CEO of VistaVu (Part 7)

Jory Lamb: In the middle of 2007, I moved to Denver to get things off the ground in the US market. In the early years in Houston, the company was a bit of a revolving door. It was really hard to retain the staff. Again, I made another error, for which I’m smarter today. I kept hiring staff, sticking them in the office and trying to manage from a distance. We had our clients and staff but every six months, we were changing at least one or two people. I couldn’t get them to stick.

The recession in 2009 was hard. But we got really close to our existing clients. We did all sorts of project work for them. We made sure that we didn’t take on any new expenditure. Especially having faced bankruptcy once, my management is probably more conservative. In 2010, I made one of the most significant hires I’ve made in my career. We hired Roy Garcia who’s the VP – Sales out of Oildex to head up sales for our company. >>>

Bootstrapping Using Services from London: Ajay Patel, CEO of HighQ (Part 7)

Sramana Mitra: What else is interesting that I should have asked you about?

Ajay Patel: One thing I think is very important for every SaaS business like ours is profitability. The market is soon going to not accept that a lot of SaaS businesses aren’t profitable. The argument is always that the customer acquisition cost is the same as if it was enterprise sales, but you only make a little bit of money. That’s why you’ve got losses in the early years. I think what’s been important with HighQ and where we’re different is we’re profitable. We do and have, for the last four years, maintained our EBITDA margins between 30% – 35%. I think that’s important. I’m a Chartered Accountant. You have to make money in a business.

Sramana Mitra: I agree on that. I don’t believe in spending so much money and acquiring free customers who never monetize. >>>

Bootstrapping Using Services: Robin Wiener, CEO of Get Real Health (Part 3)

Robin Wiener: We were lucky enough to do a project. I had gone out and recruited a company that wanted to do wellness. We built a wellness platform for them.

Sramana Mitra: You were basically doing contract software work at this point. Out of those three desks at the incubator, you were taking projects and building software for people.

Robin Wiener: Exactly. One of the software we built was for a wellness company. Microsoft approached them and said, “We’re starting this brand new platform called HealthVault.” >>>

Bootstrapping Using Services from London: Ajay Patel, CEO of HighQ (Part 5)

Sramana Mitra: £50,000 is a high-touch sale.

Ajay Patel: It’s a high-touch sale. When I look at the customer lifetime value, that’s what’s actually impressive. We’ve compared sales. Who are the clients we’ve had in January 1, 2012? What do they make? What do the same clients make in January 2013? Our average cohort is 25%. The same clients spend on average 25% more with us by increased usage. That certainly helps the growth.

Sramana Mitra: Tell me about your team. You said it was you and your co-founder Veenay. Then you hired a COO. What else have you done with the team since that time?

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Bootstrapping Using Services from London: Ajay Patel, CEO of HighQ (Part 4)

Sramana Mitra: Anything that starts to validate and gets clients into a product is really a key milestone. In everything that we do, that milestone makes a humongous difference.

Ajay Patel: It was a turning point for us.

Sramana Mitra: In what year was that?

Ajay Patel: That was in 2006.

Sramana Mitra: At that time, what kind of services revenue were you doing?

Ajay Patel: I think our total revenue in those days was probably around £300,000.
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Bootstrapping Using Services from London: Ajay Patel, CEO of HighQ (Part 3)

Sramana Mitra: What kind of projects were you taking on during that time?

Ajay Patel: Development projects.

Sramana Mitra: So it had nothing to do with the legal industry?

Ajay Patel: Not much, to be honest.

Sramana Mitra: You got whatever you got and you did whatever you could get.

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Bootstrapping Using Services from London: Ajay Patel, CEO of HighQ (Part 2)

Ajay Patel: The vision was to build our own deal room or file sharing application and then license that to the legal industry. We put in our savings, which amounted to $30,000 and started HighQ. To this day, it is still a bootstrapped company. Having no money meant no salary, but it also meant that you had to spend money on what you actually needed. What we needed was a development team. We went to India.

Thirteen years on, I have to say that was the best decision we made. Today, that team is almost 100 people. I feel that if we had started off with financing or had a lot of money behind us, we may have gone for UK. We couldn’t have scaled that dev team like we have done today. We just started with product development really.

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Building Large Scale Enterprise Software Companies: Louis Tetu, Founder of Taleo, CEO of Coveo (Part 5)

Sramana Mitra: Our program is 100% based on this philosophy that you have to immerse yourself in customers and you have to understand the customer dynamics—why they buy, when they buy, and how they buy.

Louis Tetu: If you do that, you can use seed capital to get very quickly to a use case and some customer adoption. Then, you can leverage upon that to raise the next round. I’m not saying it’s easy, but I’m saying that’s the way to do it.

Sramana Mitra: No arguments whatsoever on that. Now that we have that point fleshed out, what else do you want to tell in the Taleo story? As you pointed out, we have done the story with Michael.

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