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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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Building Large Scale Enterprise Software Companies: Louis Tetu, Founder of Taleo, CEO of Coveo (Part 4)

Sramana Mitra: Just to get the facts straight, you have a bunch of Fortune 50 companies starting to adopt the solution. You did the seed round yourself. What about the venture round? At what point in that adoption cycle did that venture round come in? I’m not talking about post-IPO. I’m talking about the pre-IPO venture round.

Louis Tetu: We did two because we were fairly capital intensive. When I look at the amounts invested today, it’s still low. We raised a total of $36 million. That was back in 2000 to 2001. We raised a $10 million in 2000 and $25.5 million in 2001 with Bain Capital. The fact is that because we were selling subscriptions, from a pure financial perspective, we were financing customers. In addition to that, we had to build a server infrastructure which was also, at that time, very capital intensive. It was a double whammy from a cash consumption perspective that required quite a bit of money. In 2001, the $25 million round of capital with a software firm that only did $2.8 million in trailing revenue was pretty significant.

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Building Large Scale Enterprise Software Companies: Louis Tetu, Founder of Taleo, CEO of Coveo (Part 3)

Sramana Mitra: In the case of HP as the anchor tenant, were they paying you?

Louis Tetu: They were in exchange for significant development capacity and applications suited to their needs. Of course, we had the framework for that. As I said, we went to them with a concept of digital competence profile. That was a significant value proposition to large companies, which is evidenced by the fact that by 2004, Taleo had 40% of the Fortune 500 as customers. Those companies deal with a lot of people and did that in very antiquated ways just by reading résumés and writing job descriptions. We thought there was a better way to perform the match as well as manage that supply chain. There was quite a bit of science behind it.

Sramana Mitra: In that early phase when you got HP as your anchor tenant and got Taleo off the ground, did you also put in some seed capital or did you raise venture capital at that point?

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Seven Steps to Apply Design Economically in Startups

By Guest Author Soren Petersen

Startups’ biggest challenge is designing a Minimum Viable Product (MVP) and using it to prove that a niche with paying customers can be profitably acquired. Seemingly, the more innovative the product is, the harder the initial early adopters are to locate and learn about their needs, wants and desires. For example, few knew they needed a Facebook page or a Tesla sports car before they experienced them. >>>

Building a Subscription E-Commerce Business from Switzerland: Samy Liechti, CEO of Blacksocks (Part 7)

Sramana Mitra: Is anything else interesting in your story? I find it fascinating. It’s great that you did this from Switzerland. It’s a very interesting angle that you figured out very early on in the history of the Internet. It’s wonderful to see that.

Samy Liechti: I think I have a message to all new and future entrepreneurs. I saw so many very nice detailed business plans. I think the most important thing is to start a business. The second message is it will be hard, but it’s worth it.

Sramana Mitra: You have chosen to bootstrap this company right? Right now, you’re at what level of revenue? >>>

Design Consultancies — The Perfect Platform for Launching Startups

By Guest Author Soren Petersen and Martin Willers

The world is experiencing a boom in interest around startups as well as in design and the combination of the two is seen as the perfect cocktail for creating new and innovative offerings. Despite this perfect marriage, startups still seem to be baffled about how and when to engage design. This begets the question “Why don’t design consultancies create startups?” >>>

Building a Subscription E-Commerce Business from Switzerland: Samy Liechti, CEO of Blacksocks (Part 6)

Sramana Mitra: In Switzerland, how do you market for your kind of offering? How much could you grow in Switzerland?

Samy Liechti: In the socks segment, we now have 20% market share. With 20% market share, we can grow up to 30% to 35%, but we will never dominate the whole market. We started about two years ago to invest more marketing money outside our country. It seems to be working.

Sramana Mitra: Now that you’re investing outside of Switzerland, in terms of geographies, where are you putting your marketing dollars? >>>

Building a Subscription E-Commerce Business from Switzerland: Samy Liechti, CEO of Blacksocks (Part 5)

Sramana Mitra: Interesting. In 2005, you said you had the biggest growth year. What kind of numbers did you do?

Samy Liechti: We had 75% growth. The reason was very simple. We had won an award for customer experience in the US. I remember we had a whole bunch of PR coverage all over the place. We did not have enough people, socks, and time. This brought us to the next level. I think 70% growth in one year is a lot. We had to adopt processes, systems, and so on. That was the biggest growth ever. Usually, we have 20% a year. >>>