David Cummings on Startups

Blog

  • Some Lessons Learned from Shotput Ventures

    As we finish our last minute preparations for tomorrow’s Shotput Ventures Demo Day, I wanted to reflect on some of the lessons I’ve learned. This is not an exhaustive list, but rather a few quick thoughts based on my experiences over the past three months. Without further ado, here they are:

    • Offering a co-working space as part of the program is a better way to go than no office space in a spread-out city like Atlanta
    • I saw the most progress and excitement in the final 30 days of the program, correlated with having tangible products to test
    • Letting a team change product directions mid-course is a good idea if they still have time to build something solid for Demo Day
    • Community support is invaluable and Atlanta has been amazing at helping out
    • The teams didn’t interact with each other as much as I would have liked, and we could have done a better job promoting and facilitating them spending time together
    • Developing a timeline with general deliverables at the start of the program would have been beneficial (e.g. product user interfaces, roadmaps, potential beta testers, etc)

    After Demo Day, and having more time to reflect, I’ll work to come up with additional lessons learned. I’m excited about tomorrow!

  • Deciding to Build a New Product

    After today’s entrepreneurship talk for one of Emory’s MBA classes, several of the students lined up to ask me questions. One of the questions was essentially “Do you have a finance person that helps decide when to build a new product?” I quickly said that we didn’t have a finance person help us decide and that it was still based on a gut decision and customer driven input.

    This provided a good segue into describing what I think is necessary for new product development and what I think our core competency is as a company. As for a new software product, assuming you are already following Steve Blank’s advice, I think it is critical to have a domain expert product manager and a separate lead developer software engineer. With today’s awesome web app frameworks, a small, two person team can really put together a prototype of just about anything. In my company, I believe our core competency can be distilled down to three main areas:

    • Scalable web applications
    • Online lead generation and marketing
    • High quality customer service

    So, while I don’t have more specifics on deciding to build a new product, I look at what we do best generally, solicit feedback on the idea from internal and external stakeholders, and then make a decision one way or another. Also, don’t be afraid to kill a product if it isn’t going to be successful. We stopped development of a product over two years ago after working on it for several months, and we should have stopped even sooner.

  • Iterating in a Startup Slideshow for Emory

    I’m giving a lecture tomorrow for an Emory MBA class on entrepreneurship. As for the topic, I’m basing it on my previous blog post series titled Iterating in a Startup. The slides were my first attempt at using the Beyond Bullet Points style of presentation. I hope you enjoy the embedded slideshow below:

  • Google Spreadsheets for KPI Dashboards

    My main project this week has been redoing the tracking of our key performance indicators (KPIs) so that they are centralized in a shared Google Spreadsheet with automatic color coding to indicate where we are in relation to our goals. We’ve been monitoring KPIs for years but never had a system that was as transparent and simple as I would have liked. With that said, our existing One Page Strategic Plan does contain our goals for the current quarter, current year, and next three years in a readily digestible format.

    Google Spreadsheets proved to be a logical choice as the framework for tracking our KPIs on a weekly basis due to its flexibility with conditional formatting as well as its team collaboration functionality. The spreadsheet has the following three tabs and content:

    Data

    • Department in column one
    • KPI categories in column two
    • Columns three and beyond each represent a week, with the current week in column three
    • Each row with the KPIs has a corresponding row beneath it with the calculated percent of goal in a color coded cell (based on percentages outlined in a previous post)

    Goals

    • Similar to the Data tab with departments in column one and KPI categories in column two
    • Columns three and beyond each represent the goal for that KPI in a specific quarter, with column three always being the current quarter

    Explanation

    • Columns one and two are the same as in the previous tabs
    • Column three has a paragraph explanation of the KPI and why we track it

    I’m excited about tracking our KPIs in this new dashboard format and seeing how it helps us focus on areas where we can improve our business. Please let me know how your organization implements KPI dashboards and any ideas for improvement of ours.

  • Preparing for a Scheduled Demo

    Yesterday, after talking about preparing for a sales call, the next part of our workshop was focused on preparing for a scheduled demo. A scheduled demo is the first real phase in our sales process, usually takes an hour, and is conducted with the phone and GoToMeeting for screen sharing. Depending on the product line being sold, my sales people came up with the following items to do in preparation for a scheduled product demo:

    • Send a demo confirmation email 24 hours in advance
    • Read the Wikipedia page on the organization, if present
    • Read the three most recent press releases on the organization’s website
    • Research everyone who will be present on the call, their job titles, roles, and responsibilities
    • Develop a list of questions to ask to understand pain points and BANT (budget, authority, need, and timeline)
    • Find a reference customer in the same industry or geographic region to mention

    These items are generally common sense but they are an important part of the sales process. Web demos with a screen sharing program have significantly reduced the cost of sales for many companies and I’m a big advocate of them.

  • Preparing for a Sales Call

    During our weekly sales training workshops, we pick two topics and go around the room sharing our experiences and personal best practices on the topic. The goal is for sales managers, cold callers, and sales reps to learn from each other in a collaborative, peer-to-peer environment.

    Today, one of the discussion topics was how to prepare for a sales call.  We broke it down into two sub-categories: cold calls and scheduled demos. The following best practices emerged for cold calling:

    • Look up the person in LinkedIn and record relevant pieces of information in your CRM (we use Salesforce.com)
    • Google the person’s name and spend no more than two minutes looking for additional information
    • If possible, stand up when making the call
    • Smile when talking
    • Think positive thoughts about how the call is going to be a success once the phone starts ringing

    Of course, this amount of preparation is for selectively calling companies that fit your ideal customer profile; it is overkill for trying to make 80 calls per day.

    Preparation makes all the difference between success and failure, assuming you put yourself out there. Making a sales call is already a challenge and going into it with these tips will increase your odds of success. Stay tuned for part two – talking about preparation for a scheduled demo.

  • Employee Continuing Education

    Each month I meet with a group of entrepreneurs to talk about how we can make our respective companies great places to work. We typically spend three hours in the meeting divided into two topics. One of our topics today was continuing education for employees, as defined as internal training and development as well as external programs and courses.

    At my company, we do the following continuing education and training programs:

    I picked up some new ideas at the meeting today that I’m looking forward to implementing. After we try some, I’ll report back here on their effectiveness. Continuing education is a critical part of a fast growing company and I’m a big proponent of it.

  • KPI Dashboards for High Growth Businesses

    One of the biggest challenges of a high growth business is managing communication. Paradoxically, communication within a company must increase exponentially as the number of employees grows. As more employees are hired, more layers of management are put in place, more planning must happen, and finally more communication must take place in a variety of forms. Dashboards with key performance indicators (KPIs) are a good communication mechanism to get team members on the same page.

    Our most recent project has been updating our internal KPI dashboard based on recommendations in the book Mastering the Rockefeller Habits. Currently, we’re tracking the following on our dashboard:

    • Current ratio
    • Recognized revenue
    • New bookings
    • New bugs
    • Percentage of productive engineering hours

    As you might have guessed, it is simple and not quite holistic enough to capture input from all of our different departments. We’re working on moving our dashboard to track the following categories, broken out by department:

    • Sales
      – Bookings
      – Weighted Pipeline
    • Marketing
      – Qualified Leads
      – Opportunity Value from Marketing Leads
    • Services
      – Billed Hours
      – Overrun Hours
    • Support
      – New Tickets
      – Closed Tickets
    • Engineering
      – Development Hours
      – New Bugs
    • Operations
      – Current Assets
      – Average Days Sales Outstanding

    In addition to expanding the number of metrics we track, the other major change we’re implementing is color coding the values based on percent of goal. The Google Spreadsheet cells are colored according to the following values:

    • Red: 0 – 74% of goal
    • Yellow: 75 – 89% of goal
    • Green: 90 – 109% of goal
    • Dark Green: 110%+ of goal

    I’m excited about the changes we’re implementing. Let me know about experiences in your company related to KPIs and dashboards and I’ll keep you posted as to how it works out for us.

  • Product Management Approach

    With a fast-growing technology company, the challenges of product management crop up on a regular basis. It is tough to balance desires and ideas from prospects, customers, partners, sales, support, services, engineering, analysts, and competitors. We’ve learned a few things over the past nine years related to product management.

    At my company, we’re always learning as we go. We recently implemented a change to all of our applications, where we put a big “Give us feedback” link in the header or footer of the major product screens. The feedback link points to an idea exchange specific to the product that solicits input from customers, prospects, partners, and employees. This approach has really helped gather ideas from a broader range of users, and it helps the best ideas rise to the top by way of the voting process.

    We also have a full-time client advocate for each product line who reaches out to customers to proactively solicit feedback. Our client advocates are awesome at doing quarterly check-ins, answering questions for clients before they need support, and being contact points to help get things done. Also, our client advocates represent one of the voices in our product roadmap decision making process.

    Internally, we have a 24 month unpublished product roadmap. Why don’t we publish it? Well, we’ve published it in the past, only to consistently have at least 20% of the items on it change. This causes consternation for clients who were anticipating a specific feature. A roadmap is very important, but we’ve learned that being fluid and agile with respect to continual feedback and market input is even more important. The world changes fast, and so do our plans.

    These are just some of our main approaches to product management. Product management is a tough discipline that requires synthesizing input from many stakeholders, and is more of an art than a science. Someone once said “the product is the marketing” and I couldn’t agree more. The product is the marketing and product management is one of the most important things any technology company will do.

  • Analysis of a Business Model

    A friend of mine from college emailed me today with an update on the business he started six years ago. The idea, which I’m not going to reveal because it is so easy to duplicate, is brilliant. This year he’ll generate $5 million in revenue with Google-like net margins, and he bootstrapped the whole thing. And, yes, he even worked a day job for the first four years of the business.

    Here are some general ideas behind his business:

    • Language-related service for people where English isn’t their first language
    • All work is done by highly educated native English speakers in the U.S.
    • Ordering is purely an e-commerce transaction on his site
    • Everything is done through contractors with a strong quality control focus
    • Contractors are on demand and don’t do work unless it has a corresponding contract associated with it

    I’ll be the first to admit that when I heard about the idea, I had no idea if there was a need in the market. Even better, I didn’t think the market was very big. Wow, was I wrong.

    This is another great example of how ideas look brilliant once they’ve been successfully executed. Most ideas are just that — ideas. The execution makes all the difference.