Featured Videos

Bootstrapping Using Services from London: Conversocial CEO Joshua March (Part 3)

Sramana Mitra: What did that mean? You wanted to build products using the Facebook API. Did you have an idea what kind of a product you were going to build?

Joshua March: Facebook wasn’t the ruler of the world just yet. Myspace was still big. The consultancy gig that we were doing allowed us to do stuff on Facebook and also on these other social networks. It wasn’t completely clear that Facebook was going to dominate the world. Whilst we were doing these consultancy gigs on the side, my business partner Dan and I had the idea of building this product that would enable you to write an application once and then launch it on all of the social networks at the same time. We started working on that product while we were doing a lot of these Facebook gigs. It wasn’t big money at that time but there was a lot of people who were interested in it. >>>

Bootstrapping Using Services from London: Conversocial CEO Joshua March (Part 2)

Joshua March: I set out to build this business with no real mentors and no experience on how to do e-commerce. I managed to get off the ground and have a small, live business. I even hired a team to build a website. Then the financial crisis happened. The whole saga lasted for about a year and a half, ending with my failure.

At that time, I didn’t have any idea about raising money from investors or venture capital. I certainly wasn’t getting any more money from the bank. I had to shut down the company before I graduated. It was a painful experience. I was very lucky that I never had to make the company go bankrupt. The bank had a lot of losses due to the financial crisis and knew that they weren’t going to get much of their money from me. They basically allowed me to shut the company down and walk away from the loan without liquidating it. I took on all the other debts myself. I spent the next couple of years paying off all the other vendors. I thought I’d be a billionaire, instead I was in tons of debt. >>>

Bootstrapping Using Services from London: Conversocial CEO Joshua March (Part 1)

Josh March first built a digital marketing agency around social media before identifying the product opportunity for Conversocial.

Sramana Mitra: Let’s start at the very beginning of your personal story. Where are you from? Where were you born and raised, and in what kind of background?

Joshua March: I grew up in a relatively small town in England, a few hours outside of London. It’s called Malvern, Worcestershire. It’s famous for classical music composer Elgar. It has beautiful hills and countryside. It’s a lovely place to grow up but not completely exciting from a business perspective or the perspective of a 16-year-old.

I studied an undergrad law degree at college. I really wanted to be a barrister, which is a type of lawyer in England. That really attracted me. My family were lawyers and I was very interested in it. I didn’t really know anything particular about business. Entrepreneurship wasn’t part of my experience growing up. I went to college at Durham University. I was thinking I was on a pretty clear career path. >>>

Bootstrap First, Raise Money from Kleiner Perkins Later: William King, CEO of Zephyr Health (Part 7)

Sramana Mitra: You raised $15 million in this round?

William King: Yes.

Sramana Mitra: That’s all the financing that you have raised so far?

William King: Correct.

Sramana Mitra: Tell me a bit about how you framed TAM for your business. What is the TAM model that you’ve been using?

William King: I’ll just give you a couple of numbers here. The worldwide pharmaceutical market was worth $956 billion two years ago. It will be well over a trillion dollars now. We looked at the revenues from a cost standpoint. How are they being generated? In particular, what we looked at is a >>>

Self-Financing an Artificial Intelligence Software Company: John Rauscher, CEO of Yseop (Part 6)

Sramana Mitra: What do you want to do with this company? You have built a profitable company growing at 80%. What do you want to do with it?

John Rauscher: We want to become public. We want to keep on building and growing. As we have been positive, becoming public may come sooner than we think. When we think that it will be time to accelerate and raise money through IPO, then it will be the time to go public. Being profitable year after year is critical.

Sramana Mitra: From an IPO scale point of view, you’re still too small. >>>

Bootstrap First, Raise Money from Kleiner Perkins Later: William King, CEO of Zephyr Health (Part 6)

Sramana Mitra: This, by the way, is also a trend. For the longest time, the buyers of IT were IT departments of corporations. Today and going forward, the buyers are much more going to be the business users. The marketing department, for instance, is becoming a huge buyer of IT and other departments as well. Everywhere in the organization, there are SaaS capabilities that address specific problems. The uptake of SaaS solving specific business workflows is huge outside of IT. IT is no longer the largest buyer of information technology.

William King: I love hearing that. You get to look across the landscape. That’s certainly what we hope. We’re seeing it in our buyers, but I love that that’s a trend. Another thing that we’ve done that I’m so proud of is we democratized the data. First of all, we wrangle all the data. We do all the heavy lifting. For the BI tools, when you talk to people who use them, they say, “75% to 80% of our time is spent wrangling the data.” 15% to 25% of the time, they’re actually looking at it and analyzing it. What we’ve been able to do is take that effort out and then present it in a way that a business user can make good use of. That is so powerful. That is where we get a lot more buyers. >>>

Bootstrap First, Raise Money from Kleiner Perkins Later: William King, CEO of Zephyr Health (Part 5)

Sramana Mitra: That’s the beauty of this bootstrap first, raise money later model. You’re going out to raise from a position of strength as opposed to weakness. You’re not begging for money. You’re in the negotiating position. In any given time in the market, there is more money chasing fundable deals than fundable solid deals chasing money. If you are in that position where you have bootstrapped to a certain level of validation, success, and customer traction, the likelihood of you calling the shots in negotiation is high.

William King: Exactly. I appreciate that commentary. One of the things that was important to me is our mindset of not creating a one-off product. I’m here in Silicon Valley, but I think I’m unusual in the standpoint that I’m from Princeton and I worked for a traditional company. We’ve always focused on truly building a company. That is one of the most important lessons I’ve learned at J&J. The credo, culture, and this idea of creating sustainability—these are core tenets that made a deep impression on me. What I wanted to do was go out and >>>

Self-Financing an Artificial Intelligence Software Company: John Rauscher, CEO of Yseop (Part 5)

Sramana Mitra: Let’s talk about sales. How did sales ramp at that point?

John Rauscher: Of course, it was not easy. I cannot remember that it was a big start. We had to convince a lot. We had to be passionate. We had to be very good at delivery. My philosophy is we cannot lie. You have to tell him what is going to happen and that sometimes you don’t know, because each case is unique. You have to build trust with customers. In the end, they’ll tell you that they trust you. We have been very successful because we never tried to do quick sales. We were focusing on delivering high quality service.

Sramana Mitra: What kind of average deal size were you encountering in the market?

John Raushcer: Generally, it was in steps. People were asking for pilot applications. Probably between $200,000 and $300,000 and $1,000 to $3,000 for pilot applications. People were buying licenses later. It was probably half a million dollar deal as an average. >>>