My cousin Sylvia Hatchell - head coach of the UNC women's basketball team - wrote a great piece about Bill Friday, my late grandmother Catherine Rhyne Boggs, and my hometown - Dallas, North Carolina:
Telling the Truth in Advance
A VC that I've gotten to know over the past couple years once told me that the biggest difference between Silicon Valley and everywhere else is that people in the Valley are more comfortable with and much better at "telling the truth in advance".
Fast forward to a few weeks ago. I attended Dreamforce in San Francisco. Salesforce announced - with great fanfare - a cool product called "social keys" that seems extremely applicable to what we're doing at Argyle. So I made a note to follow up on it when I got back in the office.
I read the social keys announcement blog post today and noticed this nugget at the very bottom of the post:
Currently scheduled to be available in the second half of 2013.
Guess you can do this when you're Salesforce.
Southern Documentary Fund
I recently joined the Board of Directors for the Southern Documentary Fund.
SDF's mission is to cultivate and preserve stories made in and about the South. Over the past ten years, the organization has nurtured over a hundred projects - documentary films, radio programs, and photography. SDF-support projects have screened at international film festivals, won critical acclaim, and garnered countless awards - including an Oscar shortlist designation.
As you might expect from an organization largely driven by documentary film, SDF has a very cool trailer:
I'm happy to be a part of the organization and look forward to many good things to come.
How To Email A Busy Person
Everyone is busy.
I thought I was busy while working at Bronto...and then I thought I was busy while at MBA student at UNC Kenan-Flagler.
Then Adam and I started Argyle...and then Kelly and I had a baby. And a few weeks ago, we bought a 1957 fixer-upper house in Durham.
So I've got a lot going on these days - enough to truly qualify as "busy".
And I get more email than I can possibly process - a fair amount of which includes pitches, introductions, and solicitations to "pick my brain". In part to be somewhat less irritating than the people that often email me and in part to save myself some time, I'm trying to build new email habits:
- I often include the entire message in the subject line, noting "EOM" in the subject line. The recipient can process what I'm saying without even opening the message.
- I often begin emails with "No need to reply to this message". The recipient can read without having the pressure to chime in or actually process the thought.
- I sometimes send emails to process and clarify my own thoughts - I ALWAYS pre-empt these emails with a "no reply necessary" blurb.
- Unless I solicited the intro, I ignore intro emails until the other half of the intro responds to me.
- I ruthlessly archive without reading. And I respond with a quick "no" more often than comes naturally.
- I write short sentences/paragraphs and use bullet points. Note this blog post.
Additional thoughts from the comments and Twitter:
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- I use Twitter. ~Erika @ Start-Up America.
- I add my standard mobile signature to a short note if I want to be brief without appearing rude. ~Doug @ Twitter.
Email Marketing Tips For Start-Ups
Argyle is a social media marketing start-up and we're obviously big believers in the power of social as a marketing channel. But we're also old school in the sense that we invest very heavily in email marketing.
I was employee #1 at an email marketing start-up earlier in my career. I spent four years with the company and learned a thing or two about email marketing along the way.
Here are a few email marketing tips to keep in mind for your early-stage company:
Email Early, Email Often. At Argyle, our email list was most important marketing asset for the first year. (Our Twitter following is quickly catching up today.) We collected addresses at every customer touchpoint and sent very frequent emails - usually weekly. We fired out a message every time we had something remotely interesting to say - new product features, new blog post, whatever. Momentum is important early on, so any glimmer of hope is worth celebrating and sharing.
Be Entertaining. Our product was pretty weak for the first year, so we had to manufacture reasons for people to like us. So I resorted to entertainment. Our early emails had subject lines like "Hold On To Your Butts" and pictures from awkwardfamilyphotos.com to illustrate new features. It was all about getting attention, sharing our personality, and making friends.
Invest In Automation. We used MailChimp for a long time because it is by far the best bang for the buck - great features and a strong API for peanuts. And we hacked together some very basic hooks into Salesforce and a few auto-responders. As soon as we had a full-time marketer and a few sales guys, we dumped MailChimp and moved our email marketing (and landing pages) to Pardot - a very specialized B2B marketing automation platform that integrates deeply with Salesforce.com. (We also gave very strong consideration to Marketo - it is more powerful, but also more expensive.) Today our email marketing programs are incredibly complex.
Email Like An Executive. It is obvious that you should use email to keep in touch with your customers. It is less obvious that you should use email to keep in touch with prospective investors, prospective partners, and strategic prospects. I have a couple email lists that I email ~monthly with company updates and strategic content. I do it all through Pardot and track the responses very carefully - just like we track our customer marketing emails.
Regarding Competitive Misinformation
This has become an increasingly common marketing interaction:
- A prospect tweets about their experience evaluating Argyle. Or a blogger mentions Argyle in a post.
- A competitor swoops into the conversation saying "Hey - you should check out our product!".
I don't have a problem with this whatsoever. Social is an amazing competitve equalizer. There are no protected markets - most customers are highly visible and often talking about their business problems and buying process. At any given time, it is pretty easy to track down someone that is evaluating one of our competitors or one of our customers talking about Argyle.
However, stuff like this crosses the line:
(Sendible is a tangential competitor to Argyle based in the UK.)
As the CEO at Argyle, I have unique insight into the claim that "lots of users" are leaving Argyle for Sendible. Turns out that this claim is false.
We are building *very* aggressive customer acquisition machine at Argyle. We win business with great products that solve meaningful problems and a transparent, consultative, and affable sales team. While we're happy to highlight differences between Argyle and other offerings, we never disparage or flat-out lie about our competitors.
We're overly transparent because it is good business and the right thing to do. And because the market is always watching.
A Story About Durham
This post was originally published at TriangleStartUpFactory.com.
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I first visited Downtown Durham to take a tour of the American Tobacco Campus, which was still very much a work in progress at the time. It was 2005 I think. There was an 8 foot barbed wire fence around the property and there were trees growing inside of the buildings. I was a Sales Associate at Bronto Software, which had 7 or 8 employees at the time. Bronto moved to the American Tobacco several months after my tour of the campus yet-to-be and my love affair with Downtown Durham was born.
In December 2009, when my business partner Adam Covati and I pinched our respective noses and decided to take the plunge with Argyle, we knew that we wanted to move into a Durham office as quickly as possible. After several months working anonymously in our respective home offices, we developed enough traction and raised enough money to move into a tiny office in the Snow Building at 331 W. Main St, right above Beyu Caffe.
I knew that we made the right decision the day we moved in. Adam and I were struggling to move a couch (that we bought from UNC surplus for $20) into our building and Jud Bowman, the Founder and CEO at Appia and Durham start-up veteran, happened to walk by and hold the door for us. We were bumping into guys like us on the street before we had even moved into our office.
Fast forward to today - Argyle has 21 employees and has carved out its own niche in Durham on Rigsbee Avenue, right around the corner from Rue Cler. The city is our 22nd employee. It helps us recruit, it keeps us entertained, and it inspires us to keep looking forward.
Durham is a momentum story - the culinary, artistic, and (of course!) start-up scenes have grown by leaps and bounds over the past several years. There is a palpable sense of forward movement in Downtown Durham that makes it a great place to launch and grow a start-up. I'm excited to see Triangle Start-Up Factory accelerate more good things in the Bull City.
Why Pay Sales Commissions?
Adam linked to a thoughtful article written by Fog Creek Software that described its rationale for switching to non-commission-based comp plans for its sales team. The article spurred some interesting thoughts as well as a burst of tweets from some developer friends and colleagues - presumably because the article reflects a developer perspective.
So I thought I would jot down some notes for posterity.
In short - different jobs require different skills that require different incentives. Selling and coding are incredibly different tasks and thus shouldn't be comped the same.
For our purpose at Argyle, sales reps execute a process over and over. Unit-based incentives work incredibly well for these tasks. The best sales people are coin operated - if you create a properly aligned commission plan, they'll do exactly the things that earn them the most money...which are hopefully the things that create value for the company.
Software developers solve complex problems over time. Unit incentives are demotivating when tied to these tasks. Check out this great talk from Dan Pink about the surprising impact that incentives can have on motivation.
A commission-less sales comp plan doesn't take away any of the realties of the sales role. There is still a quota and intense pressure to hit it. Just without the upside for performance beyond quota.
When done well, sales commission compensation rocks. I loved getting it as a sales rep. And I LOVE paying it as a CEO. I'll write another post about how we've evolved our commission plan over time at Argyle.
2011's Greatest Hits
These are my favorite tunes from 2011. And this is the obligatory tip of the hat to Chaz Felix for introducing me to the "annual greatest hits" format many years ago.
2007 Edition
2008 Edition
2009 Edition
2010 Edition
Interestingly, all of the following links point to Spotify whereas the previous editions pointed to YouTube, Amazon, iTunes, and elsewhere. Spotify definitely changed the way I jammed in 2011.
Other than Big Boi (AKA Sir Lucious Left Foot AKA Daddy Fat Sacks AKA Chico Dusty) in January, I can't remember going to a single concert in 2011. You see! This is what happens! This is what happens when you run a start-up and have a kid!
Such a fun, bouncy tune! A friend recommended Dawes to me and I listened to the record non-stop for several weeks.
This would be a fun song to cover. Very cool harmonies and a hard-hitting bridge. Evidently the Sheepdogs are kind of a big deal.
I read an article about Glen Campbell's struggle with Alzheimer's and the record that he released - "Ghost on the Canvas" - as a goodbye note of sorts. So I decided that I would like Glen Campbell. And it didn't take very long. This song is particularly special because I like to sing it to Thomas.
Speaking of Thomas - I have a kid now. Which means I have to listen to songs like this. Piggy Jig is actually pretty cool. Could be a lot worse...and I suspect that it will be sooner rather than later.
I have a kid, but I still like to kick @ss.
At this point, Wilco is like a worn-out pair of shoes that fit familiarly and perfectly every time. I thought "The Whole Love" was a strong effort.
Fanfare for the Common Man - Copland
I remember blasting this jam in January when we would close a deal at Argyle HQ #1, 331 W Main St, Suite 403, Durham. We weren't closing many customers earlier this year, so it was always a big deal when we got one! Luckily, we're closing much more business these days. And we have way too many employees to distract with deafening Copland.
Not ashamed that I love this song, even though many Argylers made fun of me for listening to it so frequently after it released.
Tracking Churn Versus Froth
This weekend, Kelly, Thomas, and I had brunch with some of the very smart guys at Shoeboxed. Much of the conversation centered about best practices for measuring customer retention, as all great brunch conversations do. Which lead to some interesting ideas around tracking churn versus tracking froth.
Delineating between churn and froth makes it easier to more accurately pinpoint and address the reasons behind lost customers. Churn represents customers that cancel their subscription 3 months (or more) after signing up. Froth represents customers that cancel their subscription within 3 months of signing up. These are simple definitions, there are many other ways to define the metrics.
A high churn rate more likely indicates a product problem. Churned customers bought into the value prop and stuck around, but didn't get long term value from your product. This might suggest that certain features might be lacking or that the scope of your product is too broad.
A high froth rate more likely indicates a marketing problem or, to a lesser extent, an on-boarding problem. Your marketing programs might be generating leads outside of your sweet spot. Or your sales team may not be properly qualifying opportunities. Or your services programs might be under-resourced such that new customers don't get the proper resources/training to ensure that they properly use your product from the outset.
Both metrics are important and inform different strategic decisions for SaaS companies. Identifying the characteristics of churny and frothy customers and pro-actively addressing the issues will pay off in the long term.
Risk, Focus, and Time
Argyle just turned 2 years old - plenty of details on the Argyle blog.
And I just skimmed this blog post via Hacker News - I'm turning 30 and I've produced no amazing art.
And I've had a few conversations with a friend that is wrestling with long-term career decisions.
Which got me in a reflective mood.
I'm still MILES away from the entrepreneurial finish line, but I've learned enough and have spent time with enough successful entrepreneurs to recognize that the recipe for big success is a mysterious cocktail of risk, focus, and time. It takes all three ingredients...with a few incredibly rare exceptions to the rule. And you're not gauranteed anything even if all of the ingredients are present.
The 30 year old that hasn't produced amazing art hasn't put in the time, nor has he focused his efforts. My friend that is wrestling with the direction of her career is confused by risk - she is looking for the "certain" path to big money and a great life, which obviously doesn't exist. Both stand to see enormous entpreneurial success in their careers, but only after they come to terms with the recipe.
It has taken Adam and me 2 years, incredible focus, and multiple leaps of faith to get Argyle this far. And we still have light years to go.
Ramping New Sales People
We had a class of 6 new sales people start at Argyle last week. In addition to the usual sales, product, company training, we're doing some interesting things to get this class of (very smart, very eager!) noobs up to speed:
1.) Just as I do with all new hires - I spent a couple hours with the new folks sharing the history behind Argyle and our mission/purpose/values. I'm a big believer in mapping the day-to-day to the bigger picture as much as possible, so I like to make sure that new team members get a very clear picture of who we are and what we believe at Argyle.
2.) The reps earn small wins every day based on their performance and level of activity. The first rep to complete an assessment call earned a $50 AMZN gift card. The first rep to complete 5 assessment calls earns a $50 AMZN gift card. And so on. Our Dir of Sales Vimal Patel is great at using games and/or small incentives to encourage the right behavior.
3.) The reps level-up based on performance. We have a few lead sprinklers that assign leads to sales associates. Reps earn access to the "better" sprinklers based on their performance. Reps start out cold calling and dumpster diving in Salesforce. They will eventually (hopefully!) earn their way to the most desirable sprinkler, which allocates the "I'd like a demo of Argyle, please!" leads. These leads close more quickly and more frequently, so the they have a very strong incentive to work up the food chain as quickly as possible. This idea came from Tristan, our Dir of Ops.
Streetside Collards
I bought fresh collard greens from Elder Bond and his mother Lela on my way home from work. I asked if I could take a picture. Mr. Bond said yes and asked me if I would put the picture on the Internet for him. So here it is!
Happy Thanksgiving!
San Francisco Debrief
My business partner Adam and I spent a few days doing business in San Francisco last week. All business and/or relationship development, no fundraising.
I've been to San Francisco multiple times, but this was my first visit as the CEO of a start-up. (If you're new to this blog - my company Argyle Social is based in Durham, NC.) It was an eye-opening experience. Turns out that a lot of what they say about the Valley is true.
1.) Everyone very genuinely wanted to help us out. We met with 8 companies - some big companies that you may have heard of like Twitter and some smaller companies that you will probably hear of soon. Every conversation was incredibly transparent and collaborative, even though Adam and I were complete strangers for the most part. A case in point of start-ups (and former start-ups made big) helping each other out.
2.) Everybody knows everybody. The UserVoice guy went to a beer night at Klout. The Klout guy's brother is the API guy at Twitter. The business development guy at Twitter went to UNC. (You get the idea.) No different than any other start-up community...except that the Valley connections are with the most important companies in the world. Adam and I made great connections on this trip and I'm confident that these great connections will yield even more connections.
3.) Start-ups are everywhere. Adam got the great idea to start using Foursquare on the trip...and he convinced me to join the effort. It was amazing - and, frankly, frustrating - to do a Foursquare check in at Klout and find that GitHub, EventBrite, EngineYard, a laundry list of other interesting companies are within a 100 yard radius. There are a handful of start-ups in Durham, NC that I consider peers. There are a handful of start-ups in every building south of Market in San Francisco. And we didn't even venture out to Mountain View, Palo Alto, etc.
I'll be making trips like this (at least) once a quarter going forward and I strongly recommend it to any other CEO of a web start-up. It is useful to get away from the office so that you can think, helpful to build relationships outside of your geography, and energizing to get plugged in to the epicenter of the business.
Book a few meaningful anchor meetings that actually warrant the trip and then work your network to fill up the rest of your time with spec meetings.
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.
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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.
Business Lessons From Baseball Cards
This post started as a comment on David Cummings' blog - he wrote a great post about his brief experience as a sports memorabilia dealer when he was in high school. His subsequent ventures have been much more successful...and his blog should be required reading for SaaS start-ups.
I've written once before about my childhood obsession with professional athletes - their autographs, their statistics, and - of course - their trading cards. I had a great time as a kid soliciting autographs via fan mail, which was often ghost written by my dad.
David's post inspired me to jot down a few business lessons I can recall from my incredibly nerdy time trading ball cards with my equally nerdy friends in the late 80s and early 90s:
Ask for what you want. I was obsessed with collecting Wade Boggs cards because we share the same, unique last name, because we both batted left-handed, and because we were both doubles hitters - which was code for "too weak to hit for power" in my case. I knew what I wanted and I made the trades to get it.
Know what the other guy wants. Similarly, I knew what my friends wanted. Drew liked Joe Oliver and the Cincy Reds, Joel was a sucker for Jose Canseco, Justin went for any trade involving a Washington Redskin, etc. I made some great trades exploiting these weaknesses. I fleeced my (admittedly younger) cousin for a Jerry Rice rookie card with a crusty Art Monk card that he didn't have - just because he was obsessed with the distinguished Redskin. (Of course, I'm sure I gave up the farm to get an elusive Wade Boggs card on several occassions.)
Understand value. I remember verly clearly chirping to my father: "This card is worth $10!" And he would invariably respond: "Worth $10 to who?" His response infuriated me when I was a youngster because I never had a clever retort and because I knew that the card was worth something to someone besides just me - but I didn't really understand how or why, that is other than it was listed in the Beckett Baseball Card monthly as worth $10. Turns out that the market defines the value - not me, not my dad, and often not even the hallowed Beckett.
Take care of your childhood toys. My father had several thousand dollars worth (in 1991) of baseball cards from his childhood - Mickey Mantle, Whitey Ford, Willie Mays, etc. He just made the mistake of clothespinning them to his bicycle so that his spokes would make a cool noise while he rode around the farm. :)
What Keeps You Up At Night?
I've had people ask me this question several times over the past few months. My usual answer is customer acquisition...but my new answer is Thomas Ferdinand Stowe Boggs:
My wife Kelly and I welcomed Thomas - our first child - on July 3, 2011. He's a happy little guy. And his mother and I are having a great time learning how to parent.
The Boggs Blog will resume its regular programming as soon as I'm able to figure out my new day-to-day programming.
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.
