The Risky Start-Up Myth

Argyle presented at Tech Jobs Under the Big Top last week.  Big Top is a very cool, circus-themed job fair put on by Durham start-up instigator Chris Heivly.  

The event was a lot of fun and we met quite a few interesting candidates that I suspect we'll phone screen over the next couple weeks.  We also met an endless stream of unemployed people - some recently, some more-than-recently - that had spent their careers at big companies like IBM, Cisco, etc.  

Many young professionals and graduating students look to these big companies as the "safe" place to work.  You can get experience, you can move up the ranks, and so on.  

There are certainly reasons to work for big companies, but I believe that this "safety" is a fallacy in large part because one has very little control of their own destiny at very large organizations.  A fluctuation in the share price or a decision from on high or a mistake four times removed from one's role might end up in cancelled projects, missed promotions, or worse.  The unemployed big company people I met at the event seemed perfectly capable, just unfortunate.

Sure - start-ups are risky...and risky beyond comprehension in the very early stages.  But one's scope of influence is much larger and the distance between input and output is practically zero.  Plus, one can actually eliminate risk at a start-up.  Most of my day-to-day actions at Argyle are focused on making our business more predictable, repeatable, and scalable.

To bring this full circle, imagine the irony when one of the larger companies that participated in the Big Top event "pitched" the audience by showing a video that featured its employees gushing about their job security and peace of mind.  I couldn't help but laugh to myself just a little...

A Few Fundraising Lessons

Argyle closed a $1.24M Series A a few weeks ago.  You can read about it on our blog.

Though we ended up opting to raise an internal round, I spent lots of time interacting with several prospective investors.  I learned some lessons along the way, mostly by making mistakes.  Here are a few mistakes/lessons fit for public disclosure:

1.)  Don't waste time following up on unsolicited emails from Junior Associates.  It was pretty exciting to get pinged by prospective investors the first few times, but I quickly caught on to the schtick. The pitch is always the same - We've heard a lot of great things about you, we're interested in the space, let's spend some time on the phone. It only takes a couple of these phone calls to realize that these emails usually come from a 24 year-old Associates that just got out of an investment banking job, knows absolutely nothing about your business, and has next to no influence at their firm.  They're just prospecting for deals.

2.)  Don't waste time talking to funds that don't invest in early stage deals.  Everyone says that they're an early stage investor, but that's certainly not always the case.  Many mid/growth stage investors will spend time with early-stage companies just to get a close look at the business/team in hopes of building a relationship.  Make sure that you understand the fund that you're pitching - both in terms of deal stage and fund stage - otherwise you'll spin your wheels with someone that is 18 months away from even thinking about writing a check.  Most VC/PE funds detail the characteristics of a typical deal on their site...or they'll simply tell you if you just ask.

3.)  Don't discount the power of the network.  Several people helped me kickstart the fundraising process by making email introductions to prospective investors that I didn't know.  At the time, I was a bit surprised by how many of them turned into significant conversations.  Looking back, it makes a lot more sense.  The network is everything when it comes to putting a deal together.  Once I made a connection with an investor, it was very common for them to introduce me (via email) to a portfolio CEO or another propsective investor as a part of the shakedown process.  It really is a game of who knows whom and who thinks what - a game make all the more interesting because everybody knows everybody else.

These are the tip of the iceberg lessons.  I'll share the rest in my memoirs.  Or perhaps over drinks if you buy me enough beer.  :)

Bull City Stampede...

...happens again this fall.  Details below.

--
The Bull City Startup Stampede is back! After a very successful spring season that brought 15 companies to downtown Durham for 60 days of free office space, the Stampede will be running again this fall. Participating companies receive free space complete with furniture and a 50:5 wi-fi connection and access to a wealth of startup experts.

A few participants will also be eligible for free startup law packages from Hutchison Law and Morris, Manning, Martin. Previous Stampede companies have used the initiative to garner media attention for their software or product, raise a seed financing round, and build a top flight network in the Triangle.

The application process is very simple and only requires a one-pager on your concept, team, and market opportunity. Applications close Friday, August 12 at noon.

To apply or for more info, visit www.startupstampede.com. The Stampede will begin September 16 and end November 18.

Quarterly Planning For Start-Ups

I've been switching in and out of quarterly planning mode for the past few weeks.  So I thought I'd share a few thoughts on the matter:

SWAGs are fine at first.  Our Q1 2011 plan was our first ever official "quarterly plan".  I put it together an hour before I presented it to the team.

I pulled most of the quantitative goals out of thin air and spent 30 minutes running through the product plan by Adam.  It really wouldn't have made sense to do much more at the time.  We were still in survival mode at the time, so the plan really boiled down to "ship product, get customers, as fast as possible".  

We moved around some of the product priorities, but we otherwise did just about everything that we said that we were going to do - including hit the number.  Execution against a plan builds credibilty with the team and the board, so this was a big win for us.

SWAG planning falls apart fast.  I did the Q2 plan in the same fashion and it burned me a little bit.  

My board called me out on one of the numbers that I lazily forecasted.  (We were very fortunate to have numbers that actually started to matter!)  And our Director of Operations called me out for not including him in the process, rightfully so I might add.

At this point, we had enough moving parts to warrant a more thoughtful plan around top priorities.  In retrospect, I think this transition snuck up on me a little bit.  When you're slogging it out every day, it becomes difficult to look up and recognize that you're actually starting to make progress.  

Survival mode becomes habit if you're not careful.  And a potentially a dangerous habit if you don't poke out of the weeds from time to time.  It is imperative to make sure that the team is marching towards the same objective, even when you're in the process of figuring out the direction.

Minimum Viable Planning.  The Q3 planning process has been much more collaborative and much broader.  That said, the process remains fairly lean. We're using the same planning template as the past, just with a clearer story and more supplementary content.

Instead of dictating the goals and plans, I've tried to set a direction and the top priorities - in conjunction with Adam - so that the team and I can collaborate on the plan.  Every functional area has provided P1s (short, memorable phrases like "Build Machinery" that represent the "priority one" for the quarter) and a few quantitative goals that align with the strategic theme for the quarter.  

We have a plan and it is a smart one.  And we're going to execute the sh!t out of it.

That said, there are definitely some things that I'll do differently when we start planning for Q4.  I suppose I'll write about it then.

Tips For Your Start-Up's First Board Meeting

My friend recently closed a financing and will have his first board meeting this afternoon.  His company has been around for a while and is doing quite well - but this is the first institutional money he's raised and the first time his company has had an "official" board.

Exchanging emails with him this morning made me think about Argyle's first board meeting in October, so I thought I'd share a few thoughts that entrepreneurs might consider going into their first board meeting with investors:

• Don't be nervous.  I was pretty terrified going into our first board meeting - I had never been a CEO and I had no idea how boards work.  Turns out it was a piece of cake.  If you've raised money from great investors, they've likely done 100s of board meetings and will help shepherd you through the process until you figure it out - which generally takes a meeting or two.
• Start by saying "thank you".  The board members just invested in your company and - in doing so - showed that they have a lot of confidence in your company and your ability as an entrepreneur. You likely just wrapped up a stressful ("adversarial" - at least legally speaking) negotiation to get the deal done, so it is great to start out on a really positive note!  
• Prepare a very simple board deck, if you even prepare a deck at all.  Certainly talk about any pressing near-term issues, but otherwise make the meeting a meeting about future meetings.  Talk in broad strokes about how the board should function going forward and discuss the indicators you'll want to track as a company.
• Give your board homework.  I asked for 5 sales lead email intros per board member in the first meeting.  Everyone loved it.  And everyone delivered.  We got a customer out of it and a few very valuable relationships.
• Enjoy the honeymoon.  For a very early stage company, the first post-investment board meeting should be a high-five event - everyone is excited about the future...a future that you're going to create with your fresh slug of cash.  This is a very exciting time for your company!  But recognize that reality happens quickly and board meetings will quickly evolve into actual board meetings!

You might also want to read some other tips for start-up board meetings that I published a few weeks back.

Dead Simple Start-Up Sales Processes

One of our biggest sales operations hang-ups to date has been the lack of clarity around the sales process and lead/opportunity designations, so I spent a lot of time last week documenting Argyle's sales process and tweaking Salesforce to accomodate.  

We created specialized values (beyond Salesforce's standard values) for Lead Status, Activity Type, and Opportunity Stage and a few flow charts to reflect our view of the world and our evolving sales process.  We discussed as a team this morning.

A few lessons learned:

• The process should be obvious.  It is important that it is very clear to the team how they should log their activities, opportunities, etc.  They've got a thousand things on their plate, so the workflow should be dead simple and straightforward - otherwise you don't get the data or behavior that you're seeking as a manager.  For example, it was previously unclear when the rep should convert a Lead into an Opportunity.  No longer - we set very clear criteria for doing so.
• A very clear process helps the team do their job.  Selling becomes just that - a very clear process.  Deals start to look the same, conversations get more consistent, and punches get tighter.  The goal is to make the process completely repeatable.
• Beware of transition states - objects can exist in limbo forever.  We created new values like "Unable To Qualify" so that leads don't exist as "Contacted" forever and "Closed Dead" so that stalled Opportunties don't sit in the "Negotiation" stage indefinitely.  Everything should move toward a terminal state.
• Recognize that your sales process is always evolving.  We've made some strides recently, but still have a long way to go before we reach the sales process Promised Land.  You can always simplify or augment as necessary.  The sales guys will usually pipe up if something isn't working very well!  

 Thoughts?  Anything else to consider for early-stage, sales-driven start-ups?

Sales People Do Exactly What You Pay Them To Do

The Argyle sales machine is powered by three very talented youngsters:  Danny, Matt, and Clay AKA "DMC".  Even though they're not 15 year sales veterans, they're very quickly learning the trade and very quickly driving results.  

They're also very quickly showing many of the classic sales behaviors!

They follow the money.  We made a minor tweak to our comp plan last month and the team very quickly figured out the types of deals that make them the most commission.  And now they're trying to find as many of those deals as possible.  Similarly, they're quickly learning to make calculations regarding their time, the particulars of the prospect, the likelihood a deal closes, and the likely pay-off.  This is exactly the type of balancing act that you want them to learn as a manager.

They ask for what they need to make more money.  Our product is constantly evolving and we definitely have a few shortcomings in some important funtional areas.  And the sale guys are very vocal about it.  In their minds, addressing these shortcomings will help them sell more product...which will help them make more money!

They ask for what they need to save time...which helps them make more money.  We use Salesforce.com and we have (what I suspect is) a reasonably advanced implementation for a team as small as ours.  But our guys are always driving for more process and cleaner workflow so that they can spend more time dialing and less time administrating.  (This type of process feedback is one reason our team rocks!)

In short - our sales team does EXACTLY what we pay them to do.  Which is why it is critical that sales compensation plans align with broader sales, marketing, product, etc. strategies.  More on this in a future post. 

The Argyle Social Vacation Policy

I updated Argyle's vacation policy in our wiki tonight:

Kick butt and take names. Take as much time off as you need to optimize future butt kicking and name taking.  Just let your manager know when you'll be out of the office by completing the Out of Office Form.

(I added the bit about the form.)

Our vacation policy is very much inspired by the Netflix Freedom & Responsibility Culture.

Should Marketers Rent Or Buy?

Brian Halligan - HubSpot CEO - gave a great marketing startegy interview on MarketingPilgrim.com earlier this week.  In the interview, Mr. Halligan drew an interesting parallel between renting and buying as an online marketer:

Marketers are traditionally renters. They rent space on shelves, they rent space in Adwords, they rent space at tradeshows or they rent giant lists to cold call from. None of this is anything they own.

We believe that the best way to market a product or service is to create assets that you own and can nurture. Things like unique content, links, Facebook fans, Twitter followers are assets that stick around and, from a monetary aspect, can cost a lot less than the old model.

I dig the analogy.  Here is my addition $.02:

• For start-up marketers, it probably make sense to begin with a rental strategy to find your audience and hone your message.  It takes a lot of effort to develop "owned" marketing assets, so I suggest investing wisely.
• Halligan makes the argument for quantity over quantity.  Even though he has internal data to support his claim, I think that this is a fine line.  HubSpot generates a ton of content and I read none of it.   Other companies and bloggers publish less frequently, but I read every single piece they produce.  Depends on your target customers - are they sophisticated or are they beginners?
• Creating is more valuable than sharing in the long run.  I'm blown away by the number of social media marketers that seem to think that curation is just as important as creation.
• Content marketing is a habit.  The recent rebirth of The Boggs Blog is my effort to get back in the habit.

A Great Idea For Lead Follow-Up Emails

We drive a fairly significant volume of leads through a "download a whitepaper" call-to-action - which has a great conversion rate, but generates leads a bit further up the funnel than a "request a demo" or "free trial" call-to-action.  (I've written about the trial vs. demo call-to-action previously.)

Whitepaper leads can be tough to qualify - they haven't indicated any direct interest in our product, just the contents of the whitepaper.  As a result, our sales reps are very direct in their email follow-up.  Here is an example email we send to our whitepaper leads:

I saw that you downloaded one of our whitepapers, and thus I have a question.

Which one of these categories do you fit into?

A. You're just checking things out and there is no way you want to talk to me about Argyle.
B. You're maybe interested and may want to talk b/c you're learning and have questions.
C. You're dying to talk to me and couldn't wait for this email to arrive to your inbox and you are ecstatic that it's finally here.

Let me know which bucket you're in and I'll act accordingly!

Matt 

This approach works really well!  We make it very simple for the lead to qualify itself.  If the answer is "A" - then great, we don't waste any time on the lead.  If the answer is "B" or "C" - then we spring into action. The anecdotal response rate is significantly higher than the usual boring, email follow-up stuff.  And prospects get a teensy glimpse into the friendly way we like to do business at Argyle.

Hat tip to Brad McGinity from Windsor Circle for recommending the format.

Never Give Unless You Receive

Generally speaking - it is better to give than to receive.

That is unless you're selling something, in which case only suckers give without receiving.  Reciprocity is the name of the game when it comes to negotiating with a prospective customer, partner, etc.  

A very simple example

• Prospect asks for a discount on product XYZ.
• Rookie says "OK".
• Killer says "Sure - I can give you that discount on an annual agreement executed this week".

This is a difficult discipline to build because most salespeople are natural pleasers - who doesn't want to make the customer happy by giving them what they want?!?  It takes a lot of confidence to tell a prospect that is ready to buy "no", in part because it is always sooo tempting to just get the deal done.

The reality is that a lack of this discipline can get very expensive, very fast.  A skilled negotiator on the other side of the table is going to keep asking until the Rookie says "no" and tear the rep to shreds in the process.  (I've been on the giving and receiving end of said shredding process!)  

Putting a condition on most "yes" answers is a great way to diffuse this problem.

Mandatory Reading For All Entrepreneurial "Business" People

One of the most annyoing things about business school were my many classmates that had "an idea for a start-up" that never did anything to realistically pursue the idea.  Many of these classmates were just poseurs.  Others had personal constraints (family, fear, debt, etc.) that precluded them from taking the first step - which is perfectly understandable.

I think that the underlying problem for a lot of these people and - quite frankly - most business people with an "idea" is that they don't know how to take the first step.  

Turns out that most business folk don't know that ideas are worthless...and that getting from "idea" to "product" requires incredible amounts of work, thought, patience, etc.  Getting from "product" to "company" is about 10X as difficult.

Too many that think that the first step is writing a business plan and then hiring some contract developers. Too few realize that the correct first step is a technical co-founder.

I sent this article by David Albert - An Open Letter to Business People - to some of the entrepreneurial faculty at UNC Kenan-Flagler Business School with the hope that they would share it with every MBA student with an idea that "just needs a developer":

So you have an idea for a startup? Awesome! The world needs more people like you. You're going to have to start by finding a technical cofounder. This is hard because you're not a programmer, so I'm going to teach you how to do it.

You'll notice I said "technical cofounder" and not "developer." That's important. If you decide to pay someone a few thousand dollars for a web app made to your specifications, you will probably fail. Why? Because your idea is not very good yet. You're going to have to iterate a whole bunch of times before your idea succeeds. You need someone who's going to be in it for a long haul. You need a technical cofounder.

I posted this today because my friend Patrick Vernon sent me the following email:

By the way, I can’t tell you how often I share this article. I’m forwarding it again this morning to a former student with a “great idea.”  :)

The Sales Break Up Voicemail

If you've ever worked in sales, then you know this routine:

• Lead pops up via free trial, whitepaper download, demo request, etc.
• Sales guy immediately calls lead...no answer, leaves voicemail and sends email.
• Sales guy tries to contact lead for a week or two with no response - leaves more vmails, emails.
• ...
• Sales guy eventually moves on to the next lead.

 This is a universal occurence and of couse we deal with it a lot at Argyle.

I recently read a blog post about leaving a "break up" message with these leads.  (Can't remember the source - will add a link if I can dig it up.)  Instead of the standard follow-up stuff - thanks for your interest, just following up, value proposition, etc. - the break-up message is literally a break-up:

Hey there - it's Eric calling from Argyle.  I've tried contacting you a few times regarding your recent inquiry.  We haven't been able to connect, so I'm guessing you've moved on to other options.  If there is anything I can do to be helpful, please don't hesitate to call - otherwise, this will be the last time I contact you.  I appreciate your interest in Argyle!

We've started doing this at Argyle...and it works.  Don't have any quantitative data, but the anecdotal evidence is pretty compelling!  Prospects call back and they respond to the email.  And if they don't, then your sales reps don't waste anytime chasing down prospects that aren't ready to start the sales process.

I suggest giving it a shot.

Three Tips For Early Stage Board Meetings

My friends Matt and Brad started a company called Windsor Circle and recently raised $350k to build e-commerce integration software.  Matt led his first board meeting a couple weeks ago and, prior to the meeting, emailed me and another local start-up CEO - Doug from Spring Metrics - to ask about "the three things to keep in mind" for early stage start-up board meetings.

Here is a summary of my response to Matt's message:

1.  Be careful that you don't spend too much time talking about product minutia.  We spend maybe 10 minutes of every board meeting talking about the product.  It is usually a description of what we've done and what we're doing next...and how it will help us generate more revenue.  

This might seem counter-intuitive to lean-start-up-product-driven entrepreneurs - Doug actually disagreed very strongly in a follow-up email.  The reality is that we OBSESS over our product and our customers at Argyle.  Aside from prioritizing projects, product development is the part of our business that I worry about the least.  (This is a testament to our product team - Adam, Mike, & Josh.)  So I prefer to use our board meetings to talk about business-building issues.

2.  You shouldn't show your board a number, forecast, etc. unless you can explain in detail where it came from or at least explain the assumptions you made when you derived it.  I've gotten called out on lazy numbers a few times, so I've learned this one the hard way.  This mainly applies to forecasts and goals - actuals are generally pretty easy to explain.

3.  You'll get MUCH more value talking about the future than reviewing the recent past.  The standard metrics and reports are important and it is obviously very important to understand how these numbers drive your business.  But it is also very easy to get caught up in details that don't matter nearly as much as pending decisions around fundraising, recruiting, partnerships, customer acquisition, etc.

I'm no expert in board meetings.  And I'll be the first to admit I was pretty terrified when I led our first board meeting back in October.  And I'll further admit that I've got MUCH to learn about being a CEO and running an effective board.  But I think we do a pretty good job focusing on key issues at the board level.

Directors, VPs, & CXOs

These days, we're spending more time thinking about new hires and organizational structure.  In particular, we're thinking about the hires we need to manage the different functional areas of our business - sales, marketing, client services, etc.

We actually have a list of the functional areas and a list of the people - some we know, some we don't - that we think might be a good fit for the role.  For each of these roles, we try to fit the prospective hires into one of three seniority buckets:

Director - younger person that might currently be a Director elsewhere and have his eyes on the VP job.  We would expect this person to get his hands dirty at first and grow into a leader/VP type.  Probably has a chip on his shoulders, probably hungry to work hard.  Big risk, potentially big reward.

VP - more senior person that is more about managing, less about doing.  She is probably already a VP...or maybe a Director looking to step-up.  More experienced.  Less risky.  More expensive.

CXO - very senior person, definitely with a track record, probably a game-changing hire.  Very expensive...but also most likely worth the price.  Biggest concern is cultural fit given our stage.

(I'm a stickler for accurate titles - so this stuff matters to me.)

There are obviously trade-offs across each - compensation, risk, experience, cultural fit, scalability, etc.  And as is often the case, I tend to liken trade-offs to sports.  

On one extreme is an inexpensive young player with all-star potential and big ambitions - you might draft Kevin Garnett...or you might end up with Gred Oden.  On the other end is very expensive veteran player that is a known quantity with a track record - sometimes it works out perfectly, just like Kevin Garnett going to the Celtics.

Ultimately - I think - it comes down to the person.  As our "people we'd like to hire list" migh imply, we'll look for the right person for the role - regardless of experience - and then figure out a way to make it work.

Where Should I Bank My Start-Up?

I had a quick chat with a Durham-based entrepreneur in our office this morning.  I'm not sure how we got to the topic of banking, but he mentioned that he had an account with SunTrust or Bank of America or some other "normal" bank.

I immediately suggested that he contact Zack Mansfield at Square 1 Bank - which is where we bank at Argyle - or contact someone at Silicon Valley Bank.  Many entrepreneurs don't know about these banks - but they specialize in financial services for start-ups and venture capital.

I made the suggestion for a few reasons:

• These banks understand the process of starting and building a company.  And they understand the financing challenges entrepreneurs face along the journey.  So instead of working with a banker whose other customers are "traditional" businesses, you'll work with a banker whose other customers are guys just like you.
• Because of the focus on entrepreneurs, these banks provide great networking opportunities.  Square 1 hosts a monthly event called NC Spark for the CXOs of it's Durham-based clients - always great conversations and beers.  The folks at Square 1 and SVB have both introduced me to prospective investors.  Zack at Square 1 recently made an introduction to an employee that we hired a week after the email introduction.
• The advisory services we've gotten from Square 1 have been great.  Can't imagine that a relationship banker at SunTrust would be able to help me think through fundraising complexities and growth challenges we've encountered over the past year or so.  Adam Smith - Zack's predecessor, now at StatSheet - was particularly helpful in this regard.

So there you go.  Don't bank your start-up at the local BB&T.

How Growing Start-Ups Should Do Meetings

In short - all at once, very quickly, if at all.

I hate meetings just as much as the next guy - but I feel like we do them pretty well at Argyle.  On Monday mornings, I have:

• 8am sales team meeting to talk about the number, the pipeline, and any interesting/important opportunities.  Since we have a small and growing team, we also discuss process and best practices. Salesforce.com drives all of the reporting automatically.
• 9:30am client services team meeting to talk about our customers, outstanding and/or tricky support inquiries, and projects like demo videos, collateral, surveys, etc.  We're not as data-driven in this area as we need to be...but we also just hired our first Account Manager.  So we're still finding our way.
• 10am meeting with Adam - Argyle co-founder and CTO - to make sure that we have at least one time set aside during the week to stay in synch.  Lately we've been talking about fundraising and baby raising.  (Adam has a 3-month old and I'm expecting baby #1 - a boy - in a couple months.)
• 11am all-hands meeting to talk about the company and each of the moving parts.  It is important that everyone knows what everyone else is doing so that we're always pulling in the same direction.  It is also important to share individual and team successes across the company.  There are 9 of us now, so these meetings are quite a bit different that just a few months ago.  And I suspect that they'll be different again 3 months from today.
• The product team uses a scrum methodology, so they have lots of meetings - but they're all very focused and very fast.  I join some of these meetings - usually also on Mondays.

Aside from scrum meetings, that's it - so we get it all out of the way at the beginning of the week.  

The meetings are very focused - we use the same agenda format for each meeting and focus on the same core metrics and topics.  We generally don't make decisions during these meetings - they're usually status updates, feedback sessions, Q&A, etc.

Because the meetings are focused, they're also usually very fast.  All are less than 30 minutes, sometimes less than 15.

Customer Survey Tips For Start-Ups

We conducted our first "formal" customer survey last week.  (I say "formal" because we've solicited TONS of customer feedback over the past 16 months, just not all at once and not with a $100 AMZN gift card up for grabs for a lucky participant!)

Here are some suggestions based on our experience:

• Get a blend of qualitative and quantitative data.  Quantitative data is quick to gather and useful to track over time.  Qualitative data provides actionable insight and frames the all-important follow up calls.  You're doing yourself a disservice if you don't try to get a balance of both data types.
• Ask the same question in multiple ways.  For example, we asked customers to tell us what Argyle "does well", "does not so well", and "doesn't do but should start doing".  These questions are just different ways to solicit product feedback.  But by asking the question from different angles, we were able to get a suprisingly diverse set of responses.  And we were able to easily identify trends across the questions.
• Ask questions that extend beyond your product.  For example, we asked our customers to list other marketing software products that they use in addition to Argyle Social.  This information will help us have more relevant sales conversations and plan future product development projects.
• Follow up with your participants.  This requires a lot of work...but is also a HUGE opportunity.  In my experience, nothing wins hearts and minds like getting feedback from a customer, contacting the customer to discuss the feedback, addressing it in your product/service, and the closing the loop. (Nevermind that this is a great way to confirm/rejigger product development priorities!)  I'm doing lots of calls with our customers and our new account manager - Laura Coggins - later this week.  I'm really looking forward to the conversations!

Anything else to add?  

Free Trial? Or Request A Demo?

We recently made the decision to drop the "free trial" call-to-action from our site in favor of a "request a demo" call-to-action.  A few reasons why:

• We're a sales-driven company, not a marketing-driven company.  In other words, we expect to qualify, demo, and close accounts over the phone.  We don't expect customers to sign up without speaking to a rep - though it has happened quite a few times!  
• Our pricing starts at $149 per month, which prices us out of the e-commerce model.  We recently launched a $499 per month offering and we plan to launch another up-market product in the near future.  So we're migrating away from the "free trial" market.
• Free trials customers often don't have the best experience with our application.  We're targeting SMBs with a focus on those that know what they're doing - so our app is a bit more complex than that of our low-end competitors.  Free trials can sometimes leave customers confused, whereas demos let us frame the value, explain the app, and get the customer up and running more quickly.
• Requesting a demo is pretty strong interest indication and requires the prospect to clear a higher hurdle that a free trial - so our lead volume might drop, but lead quality might increase.  Not a bad trade off if you ask me!
• Free trials attract all kinds of ne'er do wells - spammers, competitors, hackers, etc.  A simple qualifying step keeps these goofballs out of your app and precludes lots of headaches. 

Thoughts?  We're watching the results very closely - will be interesting to see how the change plays out.

Unintentionally Brilliant Entrepreneurial Decisions

I started writing this post a few months ago.  I'm wrapping up the draft tonight as a part of an effort to pick up the pace on The Boggs Blog.  I've been reading lots of good stuff from David Cummings, Chris Dixon, and others - so I feel compelled to offer my humble $.02 to the start-up blog echo chamber.

Enjoy,
Eric 

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There are hundreds of highly influential inputs that factor into the "successful start-up" equation:  Can you build a product?  Can you build a team?  Will the dogs eat the dog food?  And so on.  

Founders face many challenging hurdles to jump and decisions to make in the very early days of a company.  And there are lots of blog posts about start-up advice that cover most of these issues.  But I haven't read as much about the underlying life decisions that put the founder in a position to start the company and address the issues in the first place.

Here are a few decisions that Kelly and I have made over the years that (somewhat unintentionally) put me in a position to start a start-up in Jan 2010:

Managing Debt

Kelly and I bought our first house in 2004 - back when redongo loans were the norm.  I was 23 and Kelly was 24 and neither of us made much money, but we were "approved" for a significant loan.  Thank goodness we were smart enough to realize that spending $300k on our first house was a bad idea.

Instead, we bought a very modest starter home in a nice neighborhood.  We still live in it and probably will for a while.  A brilliant decision

Managing Burn

Our personal monthly burn rate is minuscule.  Our mortgage is less than $800 per month.  We own Kelly's car and my truck out right - so no car payment.  My monthly student loan payment from business school is the equivalent of a small car payment.

If we were paying $1500 per month on a mortgage and another several hundred dollars per month on a car, then there is no way that I could have gone as long as I have without a market salary.  And if I *had* to work full-time to make ends meet, then there was no way that I could have started Argyle.

Simply put, your ability to start a company directly correlates with your ability to not get paid.

Working at a Start-Up

My first "real" job was at a start-up - I spent 4 years helping a company grow from a handful of employees and customers to 40+ employees and hundreds of customers by the time I left to go to business school.  I didn't realize it at the time, but I was working an apprenticeship that would pay enormous dividends later on.  Because my prior start-up experience, I've been able to loosely execute a well-known playbook at Argyle.  This is my first time as a CEO, but not my first rodeo.  Makes a huge difference.