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Building a Founding Team Financed Business from Omaha, Nebraska: InfoFree CEO Rakesh Gupta (Part 7)

Sramana Mitra: Internet marketing is your primary channel?

Rakesh Gupta: Yes.

Sramana Mitra: In terms of segments and where you found the most adoption, what segments are you seeing the maximum revenue from?

Rakesh Gupta: After that initial journey into financial services and insurance, what we are finding is that we have a very broad set of customers. Anybody who is a little savvy or who wants to be a little savvy about their sales and marketing is a potential customer for us. Now, we are not limited to any one or two verticals but we have a very broad base of customers. We are selling something that has a fairly wide application as I can’t imagine any business that doesn’t want to grow. We think around 5 million business owners will be a good prospect for us. That’s the market size we want to go after. >>>

Bootstrapping to $20 Million with Intelligent Financial Engineering: Tim Hentschel, CEO of Hotelplanner.com (Part 4)

Sramana Mitra: Between 2005 and 2015, there’s a ten-year journey. Can you highlight for us some of the major strategic moves that really helped your business propel forward?

Tim Hentschel: The years between 2005 and 2008 were very interesting because we had two competitors. One was Group Travel Planet and the other was Groupe. Groupe had the Travelocity contract. We had the Priceline contract, and the Group Travel Planet had the Orbitz contract. Group Travel Planet and Groupe went for the more traditional venture capital while we were the bootstrapped type. At that point, we were more lean and mean. When the economy went south after the real estate bubble burst, those two companies were already on their Round D’s, the funding dried up, and both companies went out of business.

Sramana Mitra: Were you able to get Orbitz and Travelocity? >>>

Building a Founding Team Financed Business from Omaha, Nebraska: InfoFree CEO Rakesh Gupta (Part 6)

Sramana Mitra: In terms of customer acquisition, what customer base did you go after? There’s a bit of a subtlety in that question. Typically, in data services like yours, you tend to have richer data in one particular area or a few particular areas. What was that segmentation that you went with at the beginning?

Rakesh Gupta: At the beginning, we went after the insurance and financial services segment. They had the paying capacity and they had a serious need. A lot of them belonged to larger companies but they had local authorization to spend money. The price of our product was such that they didn’t even have to get approval in any way. They can just pay it from their own pocket. We used every form of marketing that you can think of to get to them, including direct mail. That worked really well for us. That’s where the early success came from.

Sramana Mitra: Were your customers looking for B2B or B2C sales leads? >>>

Bootstrapping Using Services: eMazzanti CEO Carl Mazzanti (Part 6)

Sramana Mitra: What scale are you at now?

Carl Mazzanti: We’ve been in the middle of the pack of the Inc. 5000 fastest growing companies for the last five years. We hit $7 million in 2014 and we’re on track for revenue between $9 and $10 million this year. If we continue this for the next 15 years as we have for the last 15 years, we’ll reach $100 million in revenue.

Sramana Mitra: When you think about what you want to do with this company that you’ve created, what’s your aspiration?

Carl Mazzanti: You’re talking to someone who gets votes from our customers on a daily basis for their confidence in our ability to deliver. I would like to see our firm get to a 100 million votes on an annual basis. The next thing is I do see us expanding into more offices that are geographically close to the offices that are important for our customer base. >>>

Bootstrapping to $20 Million with Intelligent Financial Engineering: Tim Hentschel, CEO of Hotelplanner.com (Part 3)

Sramana Mitra: What did you do with that? What was the next milestone after you got that money?

Tim Hentschel: We just used it for growth. We eventually bought our own office space in San Diego and started hiring some people.

Sramana Mitra: Why would you buy office space?

Tim Hentschel: There was a real estate bubble going on at that time. Everybody wanted to buy office space. Looking back, it’s not that bad a deal. We owned quite a bit of space in downtown San Diego. It’s a good long-term investment. Now, it serves as a great collateral for us. We own eight different places in downtown San Diego.

Sramana Mitra: You built a real estate business, almost. >>>

Building a Founding Team Financed Business from Omaha, Nebraska: InfoFree CEO Rakesh Gupta (Part 5)

Sramana Mitra: Your thesis on it was that it had to be manually kept up to speed?

Rakesh Gupta: No, not manually. It has to be efficiently collected but certainly not in the fashion of crowdsourcing. It’s about collecting it in the right way and verifying it independently.

Sramana Mitra: So you verify it other than manually?

Rakesh Gupta: We can do it in multiple different ways. Every information coming in electronically is not equally accurate. If you get information from a highly reliable source that is collecting information only for that purpose, that is highly reliable. If somebody has a directory of doctors and that’s all they do for a living, that’s high-quality information. That’s very different from uploading business cards. >>>

Bootstrapping Using Services: eMazzanti CEO Carl Mazzanti (Part 5)

Sramana Mitra: In terms of your current business, what percentage of that is selling your own product versus selling other people’s products?

Carl Mazzanti: 60% to 70% is our own.

Sramana Mitra: But Infrastructure-as-a-Service, right?

Carl Mazzanti: Let me answer your first question. Your first question is what percentage of it is selling your own service that’s unique to yourself. Somewhere between 60% and 70% is our own intellectual property. The remaining 40% is when someone comes up to us and says, “I don’t want your black box, but I know you’re the best. Can you do this for us?” >>>

Bootstrapping to $20 Million with Intelligent Financial Engineering: Tim Hentschel, CEO of Hotelplanner.com (Part 2)

Sramana Mitra: Before we go to the post two-year bootstrapping phase, what did you achieve? You launched a website. You started getting customers. How did you get customers? How did the customers find you?

Tim Hentschel: It wasn’t that hard in those days. The Internet was new. Blogs were just beginning to become popular. I remember Craigslist would be a place where we would go trolling for some free traffic back in the early days. They don’t have that stuff anymore. Hotels were willing to put up links to the site on their websites. The Internet back then was a lot smaller and pretty friendly too. Google was just about to put in their minimum 10-cents bid. If you can find a Google Click these days for 10 cents, I’d be shocked.

Sramana Mitra: You figured out Google PPC at that point.

Tim Hentschel: I might be wrong on this but I think we were one of the first online travel companies to do a Google PPC campaign. I know of my business partner John Prince, they called him Johnny Google because he liked the site so much. >>>