Company Profile: CHEF

Chef (formerly known as OpsCode) is an IT Automation platform that provides solution to managing servers in the same way as developers manage code. In traditional IT, there would be team to manage the servers who would make sure all servers are running correct operating systems and apps, all security vulnerabilities have been addressed and all patches applied and servers are up to speed. If the Servers needed a change to support a change in application, the team would implement that change across all servers that are being used by the app. This works when you have a few servers. But in today’s world where the load has increased and each app uses multiple servers (especially in a cloud based infrastructure), managing each server independently is not just costly, but also slow.

Chef provides a solution to this problem. It allows IT admins to define (what they call ‘recipes’) the parameters or configurations that the server’s should be maintained at. These recipes are stored on a central server that acts as the ‘mother ship’. All virtual machines have chef client running and each server pings this mother ship daily (or at another defined frequency to check the configuration definition. If the definition matches, server does nothing. If there has been an update to the definition, the server downloads it and updates itself. This process removes a lot of manual overhead from managing the servers including running the same configuration changes on multiple servers, thus saving their customers time & money. In addition to providing the software, they also provide consultation services to help with the implementation of the software.

The market the company is pursuing is small to medium sized IT Organizations. I say IT organizations because their target customers are not just IT companies, but the IT Teams in traditional organizations that need to own and manage servers. With the current shift towards cloud based applications, focusing on customers who leverage AWS and Microsoft Cloud. To that effect, they recently entered a partnership with Microsoft to help clients set up their services on Microsoft cloud.  They are disrupting an established process – dedicated teams to manage servers, and creating a new market – automated server management.

Chef was started as an open source program by Adam Jacob by 7 years ago. Adam was working on managing server configurations and was trying to use the tools available in the market, but nothing available met his needs (remember that these were the early days of cloud infrastructure). So he wrote the first version of chef and shared code with his friends who were working on similar challenges. That led to enough early adopters that he was able to secure VC funding.

The first customers of the company were early adopters of the open source offering. First paid offering was a ‘hosted service’. Chef was offering the free open source software but would charge for management of core server (mother ship). A year later they came out with ‘Private Chef’ – a forked version of open source Chef with proprietary ‘pay to use’ features. Soon they identified that their customers needed support implementing the software and they spun off a consulting business that helps with implementation of Chef’s software. Last year, they moved back to one version of software and offered all the features as ‘paid add-ons’ thus giving their customers an ‘ala cart’ menu.

They focus on two primary channels to acquire customers. First, they attend a lot of conferences (AWS, DevOps etc) to meet potential customers and then follow-up thru email twitter etc. Second, instead of spending a lot of money on advertising, they fly people around to meet the potential customer. In these conversations, they focus more on sharing best practices than making the sale, thus building customers confidence leading to them to buy the software as well as consulting services.

The company has a “THIS” slide that is leveraged as internal positiong/vision. In order to ensure every employee is able to understand and remember it, they have kept it very simple, which I think is very effective. Here’s the “THIS” slide:

  • Fuel the love of Chef
  • Make it easy to be successful with Chef
  • Give our customers reasons to work with us
  • Be our customers and our partners’ favorite company to work with
  • Be disruptive
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Panel Interview Writeup – Feb 9

STEMBox Monthly Team: Jose Hernandez, Hui Li, Uttara Lokray, Hartley Riedner

On February 9, we were happy to have a great panel consisting of speakers from Add3.com / Seattle Interactive Conference and Admosis Media. The panel is specifically about how a small company can efficiently leverage SEO and Paid Advertising to target a specific market. We have gained great insights from the discussion on this topic. Below is a short recap on the discussion.

Q: How do you find the right balance of targeted advertising? Sometimes the ads can get very annoying for a user.

By focusing on where your customers are and what they are looking at, target advertising accordingly.  Many times, customers are delighted to find that piece of advertising towards them because that is what they are genuinely looking for. For example, geo targeting focuses on where the customers are and what exact activity they are doing. By studying their behaviors and patterns, targeted advertising can actually prove to be useful. Targeted advertising can also be targeted to be displayed at a certain time of the day and a certain time of the week.

Q: How effective is SEO and paid advertising in targeting customers outside our social circle?

SEO and paid advertising are very effective when it comes to targeting customers outside our social circle. This is because studying of behaviours and patterns of people outside social circles is difficult and learning about when to talk to them about the product or service is also unknown. targeted advertising makes it easier to target those set of customers. A good SEO setup will help a customer find our product when he really needs it! Create OGST goals to realise results. Objectives, goals (SMART), strategies, tactics ex: brand awareness, increase traffic referrals by 20% from social media, strategies, tactics

Q: What are some factors you use to determine whether to use an SEO campaign, versus a Social campaign?

There are several factors, such as whether you are trying to generate demand, and already have a good sense of your product’s “brand” (SEO), or whether you are wanting to reach the bottom of the funnel, and create brand awareness, and foster advocacy by word-of-mouth to broaden your reach.  These are issues you can consider when creating your content roadmap.

Q: SEO can seem like a big mystery, especially to those new to online marketing. What are the best practices that we can use in our current campaigns?

Google Analytics has adjusted its algorithm many times over the past few years, and a lot of “tricks” that people used to deploy to raise their search engine rank don’t work anymore. The best thing to do is get relevant content on your site. It’s not about hiding search terms in your code or pages, it’s about providing content that is really targeted to your audience. So figure out what your audience is searching for, what problems they are trying to solve, and write blog posts with solutions.

Q: What “go to market” tools do you use to manage an effective paid advertising?

  • Google: use autocomplete to discover common search terms, use Google trends to find trending searches
  • Dasheroo (connect all channels, see how its working in integrated fashion)
  • Salesforce social studio
  • Adobe media optimizer
  • Hootsuite
  • Facebook business manager
  • Pickmonkey – listening tools

Introducing Rentree –

For my interview of an entrepreneur this quarter, I decided to interview a software engineer, David Lin, from Amazon AWS who, had years of experience in the tech industry and owned rental properties, is working to build his rental app from scratch. His team consists of two other engineers from Microsoft and ex-Trulia.  Today, it is so hard for working professionals to keep up with their work and also manage rental properties.  A lot of people simply hire agents to manage for them.  However, the total value of the quality of service and the amount of the fee charged, a lot of people are not happy with their agents.   David Lin has some really bad experiences; therefore, he determined to start Rentree and its mobile platform to address the pain point.  Although the prototype is under development, the value proposition that Rentree has gained strong interests among the Taiwanese community in Bellevue.

Introduction

Rentree simplifies the relationship between independent landlords and tenants, as well as providing tools for landlords and tenants to virtually manage the properties and payment transfers. It also has the ability to create rollup for multiple properties or units so that the landlords can view all the important financial information under one roof.   Rentree enables independent landlords to: 1. Setup viewing appointments 2. Manage viewers 3. Create standard lease contract and sign via Docusign 4. Setup payment system virtually and also Union Pay from Asia.  5. Track (rollup) rent income and expenses.  6. Housecleaners, landscaper, and handymen for hire at a lower group rate.  Finally, it would be a portal to document all the messages and correspondents in a single place per renter.  The mission is to be the one stop shop to help independent landlords on their rental properties.

Target Market & Position

Its target market is similar to David himself.  An independent landlord that has decision-making ability to obtain tools and services to optimize his/her rental properties.  They are disrupting an existing market that was dominated by real estate companies, agents, who charge a steep fix fee for rentals (first month rent), and a high expense ratio on ongoing property management (5-10%).  The goal of Rentree is to develop a scalable platform to effectively increase landlord’s overall investment return and save time for other important things without the need to hire a person to manage the properties.

David gave me two examples: By renting out one property to a family, the lease and on-going management should be relatively simple; therefore, the point is that there is no point of hiring someone to manage it for you.  Rentree becomes a place where you keep track of all the information.  As time goes on, this landlord may have more properties in the future and still have a day-time job.  This landlord may need some help to scale, and rentree would be the Saas solution for the person.  The second landlord may just have one properties, but it has multiple rooms in the house for rent.  The management of the properties would be complicated.  Rentree creates a system to help this type of the landlords as well to keep track of multiple contracts, financials, and payments.

Since it is a SaaS model, the value communication would start from the direct communication with the property owners for the first set of the clients.  The model would be through the word of mouth through independent landlords and the monthly meeting of both chamber of commerce and independent investor meeting that David has been involved over the past 15 years.  He had tried to email some groups without introduction and he stopped because it did not work well.  David is considering social media to promote his startup and especially to attract the growing population of investors from Mainland China.  He is actively partnering up with some investment groups in order to gain more momentum for the people that’s investing in the Puget Sound region.

Entrepreneur Report – Lab Connect LLC

Screen shot 2015-03-08 at 8.17.51 PM

The Company

Lab Connect LLC was founded in 2002. It is a clinical research company that provides global central laboratory services including routine and esoteric laboratory testing, kit building, sample management, bio-storage and scientific support services for biopharmaceutical and CRO clients. The company has a unique combination of state-of-the-art technology, world-class laboratories, easy access to emerging markets and extensive specialized testing expertise, which means the drug development industry can rely on a single provider for all of their central laboratory service needs.

Target market

Its target market is small and mid size biopharmaceutical companies. Its target contacts are decision makers with titles such as Project Manager, Director of Clinical Operations, Clinical Research Associate, etc. with BS, MS or PhD degree, typically 35 to 50 years old, tech-enabled, but not necessarily tech-savvy.

They are disrupting an existing market. The current market size is about 4 billion dollars and the company has more than 20 competitors, including some billion-dollar companies such as Covance, Quintiles, and Quest. But the goal of Lab Connect is to develop a unique, distinctive and memorable brand to effectively differentiate from the much larger, more experienced competition. They want to promote the “decentralized central lab” concept with the messaging of “The world’s local central lab. Global reach. Local expertise”. As the CEO said, Lab Connect should be the “Toyota” or “Crate & Barrel” of the lab industry—connoting a well-designed product with good value. They are striving for a unique and differentiated “look and feel”. Some differentiating factors include connectivity and accuracy, humanness and “high touch” customer service, and high tech yet “user friendly”.

Positioning and Value Proposition

Positioning: The CEO wants to position Lab Connect as the “decentralized central lab” that provides biopharmaceutical companies with strategies for any phase of development, from target identification to commercialization, whether those companies require short- or long-term storage of their samples. He believes that proper sample management is a vital aspect of today’s clinical trials. Because samples may have to be retested for compliance, data or drug-safety reasons, a comprehensive bio-storage plan should be a part of their initial trial outline.

Value proposition: Lab Connect is focusing on taking customizable approach to meet clients’ protocol’s geographic and analytical needs, establishing regional laboratory hubs for site support, building industry leading specialty laboratories, providing unparalleled project management experience, developing innovative sample tracking and reporting technologies and keeping service oriented organizational culture, with solution driven mindset.

Channels and distribution

Since it’s a service company, its current sales channel is direct communications with decision makers of its target companies. They are taking a project management approach. Since the CEO used to work in the biopharmaceutical industry for several years before he founded his own company, he has a strong network in his target companies. He used to list all the primary contacts and let the sales people to call or visit them on a regular basis. Once they acquire a customer, they will have face-to-face meetings and start with project planning and hold routine project team meetings. They also have on-line collaborative tools with their clients.

Their customer acquisition is mainly through word of mouth. Starting from the CEO’s network in the industry, the company now has a stable customer group. Since the company did a good job in improving service quality and keeping a high switching cost, their retention rate is pretty high (around 22%, which is much higher than the industry benchmark). The company’s strategy is always focusing on increasing sales of existing customers. They’ve also tried email and cold-call sales to acquire new customers before, but didn’t achieve as many leads/sales as expected.

Entrepreneur Interview – BewithDTR

Every year, hundreds and thousands of Chinese students are considering opportunities to study abroad. This is a huge lucrative market for training schools such as New Oriental to provide full suite of services to help students achieve their dream of international study. New Oriental School is the first language training school that went public at NYSC in 2006. Since then, hundreds of language training schools and international consultancy service booming at an incredible speed. These schools provide TOEFL, GMAT, LSAT, GRE, SAT test preparation classes and experienced overseas studies consultants work closely with students throughout the entire process of preparing to go abroad: from school selection and application, to scholarship applications, to the visa and immigration process, to practical assistance such as locating student and off-campus housing.

瑗垮畨姣曚笟涔嬫梾

BewithDTR is an international study training institution providing TOEFL, SAT and US college application consultancy service based in Shanghai, China. It is named after the owner, young entrepreneur, Dong TangRong. Before starting the company, he used to work for New Oriental School. He started worked as a part-time English teacher at New Oriental since junior year in college. After years in the New Oriental, an idea is generated and growing in his mind. That is, to build a learning community that’s totally different from what’s available in the market.

Like many of the young teachers who left New Oriental, DTR started his own training school – BewithDTR. Unlike many of them, he didn’t just copycat the model of New Oriental to recruit as many student as possible and provide all kinds of language training and international study consultancy. He chose to only focus on US college application and TOEFL and SAT tests, which are the preliminary tests for US college application. The way he disrupted the market is by provided small classes (15 students) including not only English, and subject matter training, but also other subjects as culture, history, politics, music, art, modern culture, etc to prepare the students to bridge the difference before they entered a different education system.

DTR was admitted to Columbia University for Education major in 2011 and observed great difference of the mentality and behaviors of Chinese students in US colleges. He found that, though many of them might score very high at academic subjects, they have little awareness to plan their future life and career. Thus, he wanted to start a small and intimate community based study group that would help these young students not only get admitted in the best school in the US but also build their all-round competitiveness to succeed in their life.

As he had built good reputation during his past job at New Oriental in the past years, DTR leveraged “Word of Mouth” from his past students and got constant referral resources. Unlike the other training schools that either set huge 100+ student classes or one-on-one tutoring service, he intentionally limit the size of his class size to 15 and set entry barrier to accept student. That is to say, he pick the candidate students that only meet his specific critiria.

In 2011, DTR started this first class of 20 high school student and helped them successfully get accepted to their dream school, including MIT and Wellesley. These student became the evangelists for his school thereafter. They are awarded as “Angel” Students and cherished as the most important people in his life.

Array Health

With the big health reform, came the transition from the defined benefit insurance model to the defined contribution model. For those that are not familiar with this, the defined benefit model was pretty much a one-size-fits all model. An employee basically bought a single insurance plan and distributed it to its employees. The problem with this model is that each individual has different needs and so this model did not allow for choice and personalization. The reform has allowed the transformation of this model into that of a retail industry paradigm. People can now have more choice and flexibility in what they want out of a certain insurance plan. This is where Array Health comes in. Jonathan Rickert has developed a user-friendly and aesthetically pleasing interface that serves as a platform for consumers to “shop” options within an insurance plan. The platform allows the insurer to communicate better with the company itself and its consumers. With this in mind, it relieves the burden of administration costs on both sides by streamlining the workflow. In more Layman’s terms, the company sells its software to insurers (brokers) to allow their insurance plans to utilize the defined contribution model though an easy-to-use platform. This then makes that specific insurance plan more appealing to businesses looking for benefit plans to distribute to its employees.

It is interesting to note that when you view the website and read about its product and solutions, it seems as if their target market would be the consumer, businesses buying insurance, and the insurer. I personally thought the company would be monetizing on those transactions between employers and insurance companies. Its position according to Jonathan however is in fact focused on B2B selling with insurance companies, and licensing its software to these insurance companies for use.

Health reform in 2010 caused an increase demand for health insurance in the United States and thus sped up the transitional step from the defined benefit model to the defined contribution model. Back in 2006, this model was just coming out and Jonathan Rickert saw the opportunity to take advantage of it. At the time Array Health was one of the first to enter this market, and so one could say they created a market for software platforms that allow this model of insurance distribution to be viable and flourish. Since then, the competitive market space has somewhat saturated.

According to Jonathan, Array Health’s position in the market is to create a platform for insurers to help manage and distribute its products to businesses and its employees. The generation of the idea actually came when he was working in consulting and found that employers were really unhappy with the defined benefits model. He also got some inspiration by studying what happened in pension space. Finding a problem in both areas motivated him to find a way to help empower and help people make better health care decisions. So he first started validating his idea by just asking employers if they would use his product. He achieved this by utilizing his own network that he created through his consulting job as a channel.

Jonathan and the team at Array Health have done a great job of finding an opportunity and building around it. The team just had success by closing out 2014 with $13 million in venture funds, and hopes to continue to improve health care through the future.

Wellpepper: Gives Your Health a Kick

The entrepreneur I interviewed is Anne Weiler, CEO and Co-Founder of Wellpepper.

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Her business was founded in December 2012 as B2B firm that sells patient-focused rehab and outpatient treatment software to hospitals and other healthcare providers. These customers would then transfer treatment plans onto their patient’s app-based (I-Phone/Android/IPad) tool (provided free by Wellpepper), from which the hospital/healthcare provider can virtually monitor patient outcomes in-between check-in sessions. Wellpepper’s stated goal for its customers is to increase patient adherence rates to treatment programs as well as provide patients with better remote support from healthcare providers.

Wellpepper’s main customers are local hospitals and several physical therapy providers. Wellpepper will train hospital/healthcare providers on how to use the clinical application and patient treatment and analysis dashboard, both which are designed to run and be operated on an I-Pad.

Wellpepper is a disruptive start-up in that it pioneered the first holistic patient rehabilitation application for hospitals and other healthcare providers. It is the only healthcare technology company that offers digital treatment plans to patients requiring assistance for orthopedics, rehabilitation, trauma and burns, pain management, and neurology. However, in terms of the business intelligence/analytics focused patient engagement market it could be qualified as entering an existing market comprised of several firms, including OmadaHealth, a tech health startup providing an online diabetes and obesity prevention program.

The CEO, Ann Weiler believes Wellpepper is well positioned relative to its closest industry peers due in part to its early entry into this market, the loyal customer base it has cultivated, and the technological advantage offered in its suite of products.

To reach new customers Wellpepper is actively working with or aiming to foster partnership agreements with technology and healthcare companies seeking to reduce costs tied to patient treatment maintenance. Wellpepper’s executive team attend trade shows, healthcare/medical school conferences to collect leads, present their product to audiences, while finding stakeholders.

GreenRubino’s “Brandidextrous” Promise

GreenRubino is an integrated marketing and communications firm—offering a comprehensive range of in-house services. In case you’re wondering about the term, “brandidextrous,” let’s be clear that I am not savvy enough to have made it up for my humble blog entry. It comes from the About GreenRubino page on the firm’s website. If you’re a brand-essence minimalist, you should be brandtoxicated by the thought of capturing it in one word.

I talked to the firm’s president, John Rubino, to ask what makes them special. John explained, they’re the only firm around that is actually delivering on the integrated marketing promise with all competencies in-house. Over a decade ago, they made a deliberate move to become more integrated, and they have been organically growing the practice since then. John noted that it’s important to stay aware of what’s going on in the marketing industry and understand the landscape. Change is constant, and they are continuously adapting to deliver a comprehensive range of solutions to clients. When new channels and tools begin to show promise, in terms of added value for clients, they will look for opportunities to incorporate them into the business.

How does the marketer do marketing? GreenRubino has a solid reputation, which is one factor that drives new business. They actively use several channels to get the word out including social, print ads, sponsorships, and of course their website. Like many leading edge businesses, they’re striving to produce rich content that can be discovered. When talking about channels, John highlighted the Puget Sound Business Journal, noting that it has been a great resource for reaching business decision-makers. GreenRubino holds positions on a few categories in the PSBJ Book of Lists.

When I asked who is GreenRubino’s ideal client, John said they don’t try to focus on specific industries or segments, which he noted is a little unusual. Instead they look for a certain type of client who wants a partnership and wants to be challenged, rather than calling all of the shots. More fundamentally, the right client is someone who connects with GreenRubino’s work. Now I see a new angle on what it means when they say, “the work works.” An honest, authentic connection to the client is like a conduit for the brand message—at least that’s my take on it. I’m a believer: followers + 1.

Rice and Beans: An Interview with Brent Frei of Smartsheet

When asked what his “old-age” trait, the trait that exists in you that will intensify with age, will be, Brent Frei responds, “Efficiency.” Aside from his intimidating stature and preceding highly accomplished reputation, Brent is a humble man who is strikingly determined. It is apparent that efficiency is core to who he is and efficiency is the core idea behind his company Smartsheet.

While with his previous company, Onyx, Brent realized a problem with operational oversight. The observed problem extended beyond his company. Products popped up like weeds yearly to help with project management and oversight, yet nothing appeared to stick. According to Brent, many adopted tracking programs stating they were “trying such and such” but all continually returned to the use of spreadsheets. “Spreadsheets are immediately available, they’re perceptually free, they’re perfectly flexible, they don’t force me (the user) into a process and they are easily shared and changed.” Brent realized the limitations with spreadsheets. Spreadsheets are not automated. Reminders to complete tasks do not exist within spreadsheets. You had to use other software to produce documents and manage products. Hence, the birth of Smartsheet.

Brent thought, “why not weld the features of project management programs into a spreadsheet and make them work together.” Others had been continually producing products that “lined up with the definition of insanity: doing the same thing over and over while expecting a different result.” Brent’s idea merged these programs into what consumers already identified as their go to solution.

As seemingly simple as the idea appears, do not be fooled. Execution of the idea to creating a product took several years of development.

To aspiring entrepreneurs, Brent offers up this piece of advice:

“If you’re not super committed and not willing to eat rice and beans for years to get there, don’t bother. You have to be unbelievably determined.”

 Smartsheet is a testimony that Brent practices what he preaches. The first few years of Smartsheet’s existence were spent in development. At year 4, Brent was doing sales and began realizing the product did not work as efficiently as they had hoped. They realized the interface of the product was correct; people loved it when they got it. But that was the thing. They had to ‘get it’. Brent explained there were too many core concepts to learn before usability became simple.

Given the feedback, and under instructions from his wife, Brent and his team had new users test the product while they observed. Brent describes that experience as “humiliating”. Brent and his team validated every complaint heard from users. The users were right. The product needed to operate more efficiently. Given this feedback, taking the product out of beta would guarantee the company a spot with the ‘has beens’, all those before them that launched a solution that was under par of what consumers needed. They had a choice, run it into the ground or redevelop the product. They chose the latter.

They spent 18 more months in product development.

“We were set to run out of money in May. It was December. Our adult product was set to launch in February. We were coming out with Gantt Charts. The launch of Google Ads was approaching and we had invested time into adwords…just one of the 3 had to hit.”

 True to his advice, Brent did whatever he could to secure capital for Smartsheet. With 5 small children, Brent sold his house. He also went to his parents and borrowed $300,000. He undoubtedly believed in his product.

“If I believe in something, it’s not going to fail. I will die before it fails.”

The launch of Google Ads proved successful as well as Gantt Charts and the adult product launch. Soon, the company would not run out of cash in May but in June. Then it extended to July, from July to August and then beyond.

The diminishing capital honed in the focus of Smartsheet. They became incredibly, and noticeably, efficient with the use of capital. They focused in on what mattered and what actually had an impact on the growth of the company. Smartsheet began realizing customer growth of 30-40 new customers a month.

Smartsheet has grown from acquiring 30-40 new customers a month to acquiring 180 new customers a day. Today, they are listed at number 22 on Geekwire, Seattle’s Startup Leaderboard. The success can be attributed to Brent, his team and the relentless support around them. Brent’s determination is truly an inspiration. Congratulations, Brent.

Smartsheet has grown from acquiring 30-40 new customers a month to acquiring 180 new customers a day. Today, they are listed at number 22 on Geekwire, Seattle’s Startup Leaderboard. The success can be attributed to Brent, his team and the relentless support around them. Brent’s determination is truly an inspiration. Congratulations, Brent.

Michael Grabham, Executive Wireless Inc.

Background: About Michael
I had the pleasure of interviewing Michael Grabham with my ClearHome teammate, Sarah Abramowitz. Michael is a start-up veteran. He has founded five “real” businesses (his words), as well as many, many others. Currently he is Seattle director of Startup Grind, the U.S. General Manager of Send in Blue, and created the non-profit Survive the Streets: an organization that provides cold weather essentials to homeless and low-income Seattleites. Because Michael’s experience is so vast, he chose to respond to our questions by citing his experiences from both past and current business ventures. Many of his answers came from his very first company, Executive Wireless, founded in 2002. Executive Wireless created a mobile application for real estate agents called Wireless Realty, which changed the way that real estate agents do business.

Market Identification
When first launching his Wireless Realty mobile app, Michael’s marketing strategy was targeted towards Vancouver real estate firms. He quickly realized that his ideal clients were actually individual real estate agents, not agencies. Michael was quick to pivot, and changed his plan to provide maximum value to these individual agents- who he saw as “solo entrepreneurs”. In 2002, as entrepreneurially minded as the real estate agents may have been, they were not particularly tech savvy. Michael determined that the best way to provide maximum value to this client base was to sell them smartphones with the Wireless Realty software already preloaded. Michael relied on his local real estate contacts to serve as advocates on behalf of Executive Wireless. His phone/app sales were met with great success in the Vancouver market.

Next Michael expanded into Calgary, Toronto, Las Vegas, Seattle and Buffalo- each time relying on a local, pre-existing contact to advocate on behalf of the company. The regional advocate helped alleviate anxiety surrounding using MLS data in a mobile setting (uncommon in 2002), and also to increase the likelihood of converting a reputed ‘Luddite’ industry of professional into the 21st century.

Executive Wireless’ app completely changed the way that real estate agents could do their job. Previously they had needed to be at work in order access MLS data. Wireless Realty made this completely unnecessary, enabling agents to access real estate data wherever they were. Thus, Wireless Realty was a new, disruptive product.

Positioning and Channels
There was no product like the Wireless Realtor app on the market at the time it launched. It was an innovator, and its activity in multiple markets helped it to build its reputation as an authority in the real estate mobile app space. Michael leveraged his pre-existing relationships with realtor technologists, who advocated on behalf of the Wireless Realtor app. This was the case in Vancouver, and each of the subsequent market cities, and proved to be a highly successful strategy. Michael views relationships and the ability to communicate effectively as essential to getting any busy off the ground.

Spoonrocket – Good Food Fast

Spoonrocket is a food delivery service providing excellent fresh food to its customers fast and in a convenient way.  It is a relatively new start up out of the Bay Area that has just entered into the Seattle market.  At its start, Spoonrocket applied to the Y combinator and launched into the UC Berkeley area.  They started with two food options available each day (one meat and one vegetarian option) for $6 created by their executive chef to a limited area.  They disrupted the food delivery climate by providing healthy meals delivered to the customer.

Spoonrocket recently has expanded and entered into the Seattle food space.  Their initial move was to replicate their methods in UC Berkeley, however they were forced to pivot their business plan quickly upon entering Seattle.  In order to keep overhead low, they starting delivery only during lunch time and instead of focusing purely at the UW college campus they expanded to the SLU and downtown areas.  This pivot was due to customer learnings.  The company found that UW students prefer to spend time together during lunch and use the hour as social time.  The spoonrocket delivery didn’t truly fit what the customer wanted, so they looked to a more professional market in the SLU/downtown area.

While Spoonrocket initially created their own market a few years ago in the Bay Area, the climate in Seattle is a little different.  There are current food delivery services that exist, however they are disrupting the market.  They have identified key partnerships with restaurants that customers desire as opposed to the vertical integration they utilized in Berkeley.  They have created a lean and mean model with efficiently heated delivery vehicles to provide fast lunch options.

With the launch in Seattle, Spoonrocket utilized press releases into local publications to raise awareness.  They rely on Facebook and word of mouth for awareness.  In order to reach their initial customers, they offered promotions.  They targeted local desirable restaurants, such as Paseo’s to gain customers via the restaurant customer base, and advertised via social media having friends share events.  While Spoonrocket is new in the Seattle market, it is gaining traction through word of mouth and delivering food that people are looking for.

CashForApps – not trying to take over the market, but taking a slice out with a focused strategy

At its core, CashForApps is a simple, unexciting venture. It is a mobile incentivized CPI (cost per impression) advertising application which rewards users for downloading apps. Or more simply, a user uses CashForApps to download apps, collects points per app downloaded, and then can redeem these points for gift cards. Yet, in this crowded marketspace, CashForApps is thriving because of a strong technical team, a focus on customer support and defined strategy.

The market that CashForApps is pursuing is a narrow one – specifically, younger (13-25 year old) mobile gaming enthusiasts located in the US, with some customers in Canada and Europe. Specifically, they target audiences of heavy-hitter mobile games such as ClashofClans. For gaming apps who want to reach more customers or gain traction quickly, they can pay companies such as CashForApps to incentivize users to download their games (assign a higher point value). A larger customer base leads to increased advertising revenue and in-app purchases for these mobile games, and paying CashForApps is an integral part of mobile games marketing budgets. As a result, there are a number of other companies within this space – this is definitely not a new market. These sort of incentivized advertising applications or websites have been in existence for years – in fact, Bing even offered a similar incentivized program to utilize their search engine in hopes of gaining more traction years ago.

So how does a company like CashForApps survive? They are positioned as the app with the highest payout and a focus on customer support. Additionally, the development team behind CashForApps is talented, with their developers working full-time as software developers for companies such as Microsoft. This allows for an overall app experience which is higher quality and less technically buggy, helping to build a more reputable name. So to differentiate themselves from other incentivized advertising apps, they have an overall higher quality product, which is also free, for users to try and download.

CashforApps also attracts customers with a focused marketing strategy. They primarily utilize prominent vloggers in the mobile gaming scene as mouthpieces to advertise for their specific app. They will pay these vloggers to mention their app in their daily or weekly vlogs. Additionally, there is a built-in referral system which uses unique codes. Specifically, when a new user signs up, they can enter a code. They receive points for using the code, and the referrer receives points when the person completes their first offer or download. This prevents abuse of the system by having self-referrals without downloads. These vloggers have been the primary marketing focus, but CashForApps also has a twitter and Instagram to engage with customers on social media. They work with media partners to distribute newsletters and will retweet ClashofClans related posts as well as occasionally run promotions or giveaways.

Ultimately, CashForApps is not a sexy, innovative app. However, they are a focused, technically sound team and have been growing steadily since their launch only a few months ago. By using their resources wisely, building a technically sound interface, positioning themselves well in the crowded market, and focusing on social marketing with a broad reach and good engagement such as vlogging, CashForApps is poised to continue their steady growth and increasing revenues.

Entrepreneur Report – Bob Greiner, HMC Farms

HMC Farms is a largely family owned and operated fruit farm in Central California. Bob is an owner in the company, however a non-family member in the HMC line. HMC was started in 1887 and has survived many changes and difficult times in the farming industry. This post is less about HMC directly, and more about Bob’s experiences as an entrepreneur.

Bob is one of three siblings, each of which are entrepreneurs or have tried their hand at creating a business. When asked about this, Bob recalled a conversation between himself, his older brother, and their father: “We were underachievers; lazy, undisciplined. One day Dad sat us down and asked us what we wanted to do with our lives.” We didn’t have any real answers, and eventually one of us asked him what he, an electrical engineer, would do if he had to do it over. “He said he would either be a dentist or a CPA.” Lo and behold, several years later Bob became a CPA, going on to earn his MBA from UW while his brother became a dentist. Bob’s path to entrepreneurship was a little different than many. “A lot of it just happened. It wasn’t really intentional – I started off at a CPA firm, and even worked for Boeing for a time, but when I got the chance to be an owner in a business I jumped at it. I’ve always been a bit of a risk taker – an entrepreneur needs to be, and needs to be forward thinking. You can’t be consumed with the right now and you need to be willing to endure some things for the future benefit. When I was much younger, I was a crab fisherman. We were paid on how many crab we caught, not on the number of hours we worked, so there was always that thrill of ‘did we let our pots down in the right spot, did the crab come?’ Part of entrepreneurship is the thrill of the hunt, like crab fishing.” Similar to the mystery of whether you have successful pots, have the decisions you made helped company come together or not.

“Entrepreneurship is a lot of hard work – nothing is as easy as it seems in the dream phase. There are some down times, some scary times.” Bob recalls a specific time when he questioned whether he had made the right career choice. In the late nineties, our business was much different. We were more of a marketing company – we had fruit of our own, but also a lot of fruit wasn’t ours but we did the packaging, etc. “The boxes for the grapes had big wooden ends, they were rigid, costly, bad for the environment. We did a bunch of research, tests, and designed new corrugated boxes to use. We developed the specifications, ordered the boxes – we said ‘we are going to take everyone to these new boxes, save all our farms a ton of money.’ Then a couple months into storage the boxes started collapsing. Fruit was molding, the gasses weren’t escaping…it was a complete DISASTER.” It turned out the box manufacturer hadn’t built the boxes to specifications and after a year of legal pursuit, Bob’s company won out. However, the prolonged legal proceedings took our attention away from running the company so long that “we thought we were going to lose it all. We were dancing along the edge of the cliff, but we were able to put together some deals to save the company. I would have much preferred to have been doing anything else other than that…that was scary.”

Being an entrepreneur has also been very rewarding. One of the best things has been “seeing the business come together and be successful…that taking those lumps early on has paid off. The company persevered through those hard times.” If my son or daughter wanted to go it on their own, “I would say Great! I would counsel them to be better planners…do your homework and be knowledgeable about what you’re doing. Align yourself with good people.”

Bob’s final words to all of us aspiring entrepreneurs; “Know your business. Align yourself with good people. Be optimistic. Persevere. Realize that nothing is as easy as it seems.”

 

Riley CFO Services

Entrepreneurial report: Riley CFO Services

 

I had the privilege to interview Tom Riley the owner and CEO of Riley CFO Services, a company that provides their customers with the necessary tools to start, operate or enhance a business. The company offers the CFO services at a cost that start-ups and small companies can meet the expense of. The services provided are divided between the two markets of the company which are:

1.-Start-up: help configuring the best legal and tax structure, help the entrepreneur to transform the idea to reality, help with the business plan and financial projections, help with fund raising, help with investor pitch back, bookkeeping and release of monthly financial statements, HR (payroll processing) among other managerial services.  

2.-Small company*: consulting services to solve problems or to improve areas of the business. Offering a set of managerial tools through experienced and reliable experts: lawyers, tax accountants, HR, IT, etc. 

The company reaches the public through referrals, even though they have some online media like a webpage. Since the beginning the first customers of the company was an acquaintance of a friend of the owner of Riley CFO Services (Tom Riley). Riley’s friend sent his acquaintance to Riley CFO Services to receive guidance for his new start up, subsequently Riley CFO Services closed its first deal. The referral process to acquire new customers, which the company likes the most, is because of the principal that people who refer their acquaintances, are most likely to be serious, reliable and smart about business. The company is not focused in gorilla marketing campaigns, because of the market that it is looking for, which is start-ups with a good idea*. Considering the characteristics that the company looks for in its clients, both being a referral and having a good idea, makes it necessary for the company to have a great network of acquaintances. 

The service offered by the company is also offered by others companies in the Seattle area and outside the Seattle area as outsourced CFO Services. What differentiates Riley CFO Services from the competition through the eyes of its clients, is that with Riley CFO Services delivers immediate trust, because of the network link they have through their acquaintances or personal relationships. Trust in this business is crucial, because of the services provided, for example a mistake setting the legal or/and taxation structure of the company, could consequently bring serious repercussions to the business.

In conclusion Riley CFO Services will help you kick off your start up and will guide you through the entire process. Riley CFO Services will become an important ally for every single step of the process and will always be there to diagnose and offer your business the best solutions, from the daily problems (Structure the legal side, open a bank account, to complete the legal and administrative requirements to sell a product, or to raise funds) to a complex situation that the company could face.  

 

*Small companies: Under $10MM revenue

*Good Idea: According to Riley is a feasible and interesting idea.

 

Sistah Sinema: Providing Community through Niche Film Distribution

According to the Bureau of Labor Statistics, most Americans watch TV at an average of 2.8 hours a day. This makes the business of entertainment a massively lucrative industry and a place where there is a lot of competition. However, Jenifa Yador, founder of Sistah Sinema, decided to take advantage of this market to ensure the story of a unique minority community is being told and being seen.

Sistah Sinema provides access to independent films by underrepresented filmmakers at live events and online. Targeting queer women of color who are interested in film, the organization brings attention and a safe space of viewing and discussion of film projects written by, directed by or featuring queer women of color. By bringing access to films and conversations that highlight the experiences of this niche audience to scale, Jenifa has found a gap in the existing film distribution market and has sought to address the gap in a unique way.

Sistah Sinema works directly with underrepresented film makers to bring their films to market and provides a readily available audience for the films through local viewing events, run by the company. During the film viewings, there is typically discussion about the film and socializing amongst the audience, thus building a self-identified community, which adds to the customer value. The company also now provides access to the films through an online channel, via IndieFlix, for a subscription fee to the customer.

With a focus on local community access, Jenifa used existing events targeting LGBTQ and allies as an audience, to drive exposure to the film viewings. This included partnerships with local events to ensure co-marketing opportunities. Additionally, the company uses social media to drive community engagement virtually and build a viral effect. The company has been growing strongly, expanding local events across 11 cities in the US.

Cedar River Brewing Company: Creating A New Market

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The boutique beverage market has exploded over the past two decades. Craft breweries, boutique wineries and specialty spirits have emerged in every city and region nationwide and are slowly expanding internationally. The pacific northwest helped lead the craft beer scene and Seattle in particular is home to numerous nationally distribute brands. For those who are late to the game however, the market appears to be over saturated and breaking into the scene is a difficult and financially risky move. Every home brewer wishes they could have entered home brewing prior to the craft beer explosion in the 1990’s and early 2000’s and taken advantage of this ripe and underserved market.

The founder of Cedar River Brewing Company, Jeff James, began as a brewer. With decades of experience brewing beer, Jeff was looking for a new challenge. Sake, a brewed beverage, was one of his favorite drinks and thus he began brewing sake at home. Sake is more labor intensive than beer and is significantly easier to screw up. During this time Jeff was hoping to open a beer brewery but was disheartened by the over saturation of the Seattle market. It was during this time that he started to look into local sake brewers. To his amazement, there was not a single sake brewery in all of Washington state. An opportunity like this was impossible to pass up and Jeff jumped right in.

While considering how best to build his brand, Jeff decided to fully fund his budding brewery himself and forgo investors. While this is limiting him in terms of capacity, he rightly believes that to build a lasting brand with a strong core he needs to be small and agile. The current scale has him in an actual basement doing all of the work himself. While more intensive, he can make adjustments to each batch and explore new varieties to suit clients tastes.

To build his brand, he sought guidance from local restaurateurs, liquor purchasers and beer distributors. He cold-called them relentlessly to set up tastings and seek guidance regarding pricing. These were invaluable in determining what the market could bear and since these initial meetings, his prices have not had to change. Additionally, he was able to learn that he could sell more by offering a variety of bottle sizes, allowing restaurant customers to try it without getting incapacitated (Cedar River’s sake is quite strong). While enjoying the four unique types of sake they currently make, a friend of Jeff’s stopped in. This friend just returned from Japan and is opening his own sake brewery close by. By establishing himself early as the first, and thus oldest, brewery in Seattle he is well positioned to grow quickly and maintain his marketshare. For those who are interested, they have free tastings in Phinney Ridge every Saturday.

Executive Wireless Inc.

Michael Grabham is what you might call a serial entrepreneur. He has a knack for starting and running (successful) businesses. He is the current Seattle director of Startup Grind, is actively engaged in one of his many start-ups, SendInBlue, and is also running his social venture, Survive the Streets. Michael is juggling many jobs, however, for the purpose of this blog I am going to focus on one particular business that Michael founded back in 2002, Executive Wireless Inc., an organization creating mobile apps at a time when that was not yet a common startup venture. As CEO and President, Michael oversaw the success of a real estate application that changed the way realtors did business. This product, Wireless Realty, allowed realtors to access their multiple listing service (MLS) on the go instead of heading back to the office, thus transforming the way the industry conducted business.

Identifying the Market

After creating the promising Wireless Realty app, Michael began his pursuit of brokerage companies in Vancouver, BC as his target market. His initial plan was to reach the top five brokers in Vancouver’s marketplace, and so he set out to talk to all of them. After his initial interactions with brokerage companies he began to realize that he was pursuing the wrong market for his product. He quickly learned that brokers are not the ones using the MLS, real estate agents were. Not only that, but he learned that brokers did not have enough influence over the realtors to push the product on them, due to the realtors’ status as independent entrepreneurs. Therefore he needed to change tactics and target the realtors themselves. He marketed his product directly to the realtors and was met with great success.

After his initial success in Vancouver, Michael was ready to expand and started to pursue markets in Seattle, Buffalo and a variety of cities across the country. He determined these geographic markets based on several factors: successful real estate markets, large urban centers, and existing relationships. His primary criteria for entering a new city was the number and quality of his existing relationships in that space. Having relationships and advocates pre-exiting within a city made the adoption of his product easier and more likely.

Disrupting the Market

When Executive Wireless Inc. came onto the scene, it disrupted the current real estate market. However, it wasn’t disruptive in the typical sense of the word; it did not result in displaced employees and lost jobs. It instead filled a need that wasn’t currently being filled and solved a pain point. Prior to this product, realtors were reliant on visiting their office to check on MLS.This application allowed agents to work remotely, instead of being tied to the office, freeing them up to spend more time making sales and showing homes.

Offering a mobile app for MLS had never been done before; Michael was throwing this new technology into an existing market. This product was completely optional, but received high adoption rates as realtors realized the convenience of the tool. Most realtors reviewed this new market entry as a positive change and contribution to their field. This product was a first step in moving the market to where it is today.

Positioning the Company

Executive Wireless, Inc. positioned themselves as being innovators, game-changers, and industry leaders. As the first company to enter the space, they experienced first mover advantages. Once competitors entered the field, Michael and his company were already seen as the MLS mobile experts, which put them in the position of being the trusted go-to company.

Channel Utilization

Michael relied heavily on relationships and communication to promote his product, a tactic he says has worked at every one of his organizations. He began in Vancouver due to the fact that he had many personal, family, and business connections. He attributes the leveraging of these relationships to his successful entry into the market. After initial adoption of his product, word of mouth allowed him to expand. Eventually his app became the status quo and was an expected tool of the trade, making marketing unnecessary. He expanded next to Seattle where he used the same relationship utilization, specifically with a close connection at Windermere who was already a huge fan of the product. This was an opportunity for success and he took it. Relationships were integral to his success in each consecutive city.

Solveig Whittle on the Business of Music

For my interview of an entrepreneur this quarter, I decided to interview a local musician who, armed with an MBA and years of experience in the tech industry, is working to build her band’s brand from scratch. Today, Solveig Whittle is a music marketing consultant, teacher, and one half of the band Solveig & Stevie. I initially stumbled upon Solveig’s writing from an interview she did with musician Molly Lewis and was struck by the quality of the interview questions. Solveig was kind enough to sit down with me, and then follow up over email, to explain how she thinks about her own entrepreneurial venture as a musician.

Solveig’s Market

In defining her market, Solveig has found her target market to be baby boomers who are also musicians. We talked a lot about the difficulty of creating music with authentic emotional resonance while still thinking strategically about finding an audience; there is a tension there that is difficult to resolve in practice. In Solveig’s own words:

“I actually think the key to being a successful musician (commercially), and I can’t say I’ve proved this myself empirically, but it seems to be true of the musicians I study, is an intersection of three things:

  1. Passion, talent and hard work that drives one to make a remarkable product
  2. What the market/customer wants, also known as finding your “tribe” or your “1000 true fans”
  3. Serendipity, or being in the right place at the right time, and being prepared to take advantage of “breaks” (connections with influential people, opportunities for exposure, etc.)

Instead of looking at it as a tradeoff, where success requires compromise of one’s creative integrity in order to achieve commercial recognition, I think it’s a matter of doing what you love and working hard to get exposure and find the audience who loves what you do. Of course, the more accessible your music is (eg. pop), the easier it is to find your audience. On the other hand, there’s a lot more competition, so it’s harder to be heard. Finding a niche (like Molly Lewis has) can be a very efficient way to reach a minimum viable product. You don’t necessarily need a huge fan base to be moderately successful. Also, new monetization models are potentially ways to bootstrap yourself until you can get exposure to a wider audience. As I think I mentioned, I think the average musician spends 8-15 years struggling before they see much concrete financial success (or they give up).. It’s not an entrepreneurial pursuit for the faint-of-heart – or faint-of-pocket.”

When asked whether she is creating a new market or disrupting an existing one, Solveig replies that she is making her way in an existing market that is in one prolonged state of disruption.

Positioning Her Brand

When brainstorming with her daughter about how to describe Solveig & Stevie’s sound, her daughter offered the phrase “soulful pop rock,” and that is now the sub-heading on her website’s title. Aside from having a concise descriptor and identifying boomer musicians as great potential fans, Solveig also thinks about acts that have moved further along the success curve that she might want to emulate. She recommends this as a good thought exercise for all boot-strapping musicians. In Solveig’s case:

“Brandi Carlile is an artist from Seattle whom I really admire and who has been very successful recently, as well as having had a loyal following for a while. Another Seattle artist who has gotten national exposure and has done well recently (I think she has good management) is Shelby Earl. She got a feature in Rolling Stone recently and has also gotten a licensing deal for one of her songs. Another Seattle artist who does some really, really fine work is Jason Webley. I wrote a blog post about his recent Margaret project, which I just loved. It was very collaborative and highly original.”

Reaching Her Fans

In our class earlier this quarter, Andy emphasized that a good marketer chooses social networks based on where customers hang out. Solveig interacts with her fans on Facebook which, based on my anecdotal experience, seems like a good match for baby boomer musicians:

“Our Facebook band page is the primary way we are building community. I don’t track retention and referral closely as it correlates with the page. One thing I don’t do that I should is use our email list to send out a monthly newsletter. That is one of the most effective ways to build community.”

For more thoughts from Solveig, check out her blog.

Ahoy! Shore Excursions with Liquid Alaska – Port Promotions: A Chat with Founder & President, Jeff Fanning

After a long, azure stretch of open ocean, cruise ship passengers are often looking for the best means of stretching their restless sea legs. Founded in the spring of 2009 by Jeff Fanning, Liquid Alaska Tours saw the opportunity to create more value in that space where cruise tourists can find their adventurous bearing on land during their sojourn at port. After having worked in the industry for several years, Jeff was surprised that no vendors had taken advantage of the opportunity to centralize tour sales. Previously, vendors either sold tours to cruise ships – who in turn sold them to passengers at a substantial mark-up – or to passengers directly. A centralized system that provided all tours available at a given port that could be accessed in advance of arrival (usually online), as well as a kiosk on the dock for those who failed to book in advance, would provide better access, service, options, and prices for eager tourists.

The crux of their value proposition is how Liquid Alaska disrupts the pricing of tours in this market. Typically cruise lines offer the same tours that vendors sell on land but at a far higher price, whereas shore-bound vendors would rely on higher volumes but at lower margins. By creating an online marketplace where passengers could book in advance, it rewards them with lower prices and a reserved position on a tour, and it provides the seller the means to smooth sales revenue in advance of the inundation of tourists when a cruise ship arrives at port. Fortunately, Jeff’s entrepreneurial acumen proved insightful, and in five years, the Alaska native was able to grow his company substantially, ultimately acquiring the assets of a global tour provider and bringing them under the umbrella of his company. Now, Liquid Alaska – Port Promotions operates in over 200 ports around the world and favorable winds are blowing it toward even greater expansion.

The company has fundamentally positioned itself as a comprehensive tour broker that offers shore excursions at wholesale rates. It is difficult to segment the target consumer in this space, given the nature of the cruise ship industry, but broadly speaking it is the cruise ship passenger looking for an onshore excursion. Jeff pointed out that his ‘target’ demographic is between 30 and 70 years of age and, generally speaking, the younger half is more inclined to access his services online and the greying half can be found in port, at the kiosks. Very early on, the first customers were acquired the old fashioned way: in person, on the dock. However, that quickly gave way with growth and today Liquid Alaska – Port Promotions reaches out largely through digital channels, from online publication advertisements to Google AdWords to the standard players in social media.

It is an exciting industry but is not without its quirks – such as a near non-existed customer retention rate (as expensive cruises tend to be once-in-a-lifetime expenditures) – but the growth and promise of new ports ahead make sailing these entrepreneurial waters rewarding, exciting, and full of new horizons. Land, ho!

Entrepreneur Report – Henry Olson – 8 Bells Winery

I’ve lived within a literal stones throw from an urban winery for the past three years. Despite my proximity, it took me a good six months to realize it even existed. Eight Bells Urban Winery is based in a cramped little warehouse. It isn’t necessarily small but it certainly feels that way as you stand next to a forklift while barrels of future vintages tower over you. The winery is run by three retired sailors who have been making wine together the last five years but whom hold almost 90 years of combined experience.

The winery is unlike any other I have seen. Their nautical theme is more a collection of personal memories strewn across the walls. The certificates of their passages through the Antarctic or across the equator shine down and grant an air of authenticity. There is no frilliness to this place. They have positioned themselves beautifully by displaying their qualifications and asking the customer to trust them. The odd part is how well it works. Despite this rough sounding exterior, Frank, Tim, and Andy make some amazing and moderately expensive bottles of wine. The cheapest bottles come in at ~$20 while the more expensive will top $50. At the few restaurants they let sell their wine, the prices triple. The authenticity the owners and winery exude keeps their clients coming back for more, forming a valuable brand loyalty in a market saturated with “new and exciting”. It is important to note that this authentic theme works well because of who the owners are. Perhaps the best lesson is that each company can sell best in a particular way and that one of the keys to success is to find your strengths and capitalize on them.

I suppose in some ways their business model is similar to others. They enjoy selling directly to the consumer, forgoing a distributor in favor of remaining small and stable. Their weekly wine tasting is where they do the majority of their business. In the age of rapid growth, I asked them why they wouldn’t want a distributor helping them sell. They have been receiving numerous awards, including USA Todays “Top 10 Urban Wineries”, and top ratings for their individual bottles. Franks answer boiled down to personal and professional positioning. Eight Bells Winery could expand. They could follow Red Hook Breweries example and move out to a larger facility in Woodinville. Frank, Tim, and Andy could hire on help and begin mass producing their wine. And if they moved and changed, both the original community market and positioning would be gone. Every business ties together both human and corporation positioning. The pure business reasons for not expanding are few but the personal reasons are enough to convince the Eight Bells owners to stay. The community business model and authentic positioning are profitable enough and give the owners the freedom to keep experimenting.

As the interview is winding down, and the wine tasting is ramping up, I am about to ask Frank where they got their first customers. The answer becomes fairly obvious as I ask and Franks answer confirms it. By making a consumable, they were able to give free sample to their personal networks. The barrier to experimentation by the consumer is very low and the experience enjoyable. Their first customers are actually part of the exclusive Plank Owners Club. Each member was acquired through a free sample tasting and agreed to fund a portion of the original large batch of grapes for the first commercial vintage. In return, each member was given a substantial lifetime discount and early access to the new wines.

Eight Bells has built itself up in a similar way from its first customer to its most recent. They make a great product. They give some away and sell the rest. Their target market is loyal to their brand and they are happy with their position in the market. They may still decide to grow into a major producer one day and if so they will face the challenges of maintaining their identity while growing their market but for now they seem to have found a great balance.

An Interview with the Founder of ModeSens

I sat down in the Starbucks Reserves on a sunny Sunday afternoon, and through the huge windows next to my table, I saw Brian Li walking to our meeting with his shinning Christine Louboutins. Brian is the founder and CEO of ModeSens, a Kirkland-based fashion startup that aims to disrupt women’s luxury goods market.

What is women’s luxury goods market, specifically? Well, if you follow bloggers on Pinterest or Instagram and are highly influenced by what they wear; if you purchase designer handbags and occasionally purchase shoes that are worth more than 500 US dollars, you are exactly Brian’s target customer. As an experienced software developer who loves and follow fashion, Brian realized over the years that the luxury goods market is fragmented with different websites and apps exist for different purposes through a customer’s buying process: consumers receive fashion information through bloggers, fashion shows, magazines; Then they write down the brands and styles they like, so that they can purchase through department stores. Finally, they share their own looks through social media channels such as Facebook and Instagram. Brian consolidated all of these steps and created ModeSens, a website that positions itself as your best personal shopper because it feeds you information, learn your shopping behaviors, gives you information about where to get the best price, and even allows you to share your purchase inside the ModeSens community. When consumers get used to ModeSens, it surely is disruptive enough to change consumers’ behaviors.

However, how to get customers to trust, adopt and stick with ModeSens has been and remain to be the biggest challenge for Brian. “We want to get as many users as possible because that’s how we make money, but at the same time we want this website to be exclusive and by invitation-only so that customers feel special”, as Brian explained during he interview. After careful considerations, Brian decided to forgo some of the revenues in the early stage and build the site as an invitation-only personal shopper because in the end of the day, his target customers are people who have large disposable income and who shop for luxury goods, and exclusivity and status is definitely something they value.

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Limited Invitations are sent to customers’ emails once they request access

Although it is a lot slower to grow the customer base with the invite-only method, Brian was able to get more than 100 subscribers within the first 3 months through promoting among his friends. Although Brian is an ordinary software developer, his wife has been working in the fashion industry for years and personally knows a number of celebrities. In terms of how to acquire new customers outside of their friend circle, Brian said that he is giving Facebook ads and Instagram a try. Since ModeSens’ target customers are clear: females who are 25-50 years old and have high disposable income and love fashion, Facebook would be very helpful to feed ads to these people through targeted ad campaigns. A piece facebook ad can cost anything from 20 dollars to a couple thousands. A $20 ad can reach 6,000 people if you set up good keywords, and if your product is valuable to these people, a conversion rate (people who like your page) can be 5-10%.

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ModeSens’s Facebook Page

Instagram is a different story: ModeSens needs to create attractive content and slowly acquire followers on Instagram because of the nature of the app. However, Instagram is where fashion lovers and bloggers share their outfits and purchases, therefore it is necessary for ModeSens to build up its presence there. Moreover, ModeSens is planning to partner up with Instagram influencers (specifically shoe bloggers who have at least 100K followers on Instagram) to promote itself, which should bring in at least 300 followers with every campaign.

If you read this blog all the way through here and love ModeSens’s business idea, give a try. I signed myself up a couple of weeks ago and am getting addicted to it. I had a great interview with Brian, and I am very looking forward to the success of this innovative fashion startup.

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Photo with the Founder of ModeSens, Brian Li

Entrepreneur report – Jobvention

Screen Shot 2015-03-02 at 9.30.48 AMJobvention (http://www.jobvention.com/) was started in 2013 by two founders Alvin Loh and Hui Dai, who have extensive technical backgrounds from companies like Microsoft and Amazon.  Jobvention has the vision that jobs can change lives and that strong communities are employed communities. Jobvention created the highly regarded Boolean Search String Generator featured in many recruiting classes and publications around the world. And it leverages the sophisticated algorithm to source for qualified talents and connect recruiter/hiring companies with them. It provides a free resume database for customers to manage their own talent pool. The database has over 100k resume candidates which is growing daily.

When Jobvention system attempts to find a qualified candidate, it looks at when the profile was updated, suggesting that the candidate may be ready to change jobs. It also looks at the job title and considers candidates that have similar job titles and candidates that work in competing or similar companies.

Customers can also treat Jobvention as sourcing assistant to help contact and /or interview candidates. It has an applicant tracking system for companies and a resume database for individual recruiters.

Jobvention is targeting recruiters from small and medium businesses who find it difficult to source for qualified talents, especially those talent whose skillset well-match with the job description. They are basically going after an existing market of talent sourcing by leveraging advanced technology to automatically conduct data mining, indexing and matching the talent profile with job requirements. As compared to the existing headhunting service, it is more efficient as Jobvention promise to provide 5-10 qualified passive candidates in 48 hours with only $50 per job posting. Jobvention will also do technical phone screens for software developers and testers to save you time. $150 per 45 minute phone screen with a written recommendation and interview notes.

Jobvention positions itself as a job portal in between Monster/Indeed.com and Craigslist, a more efficient, effective and better solution than other job boards and traditional talent sourcing methods by providing smarter algorithms and more sophisticated machine learning and natural language processing algorithms that look far beyond keywords at a competitive price.

As for their first customers, the two founders reached out to their own recruiter network and collected recruiter contacts from online sources. They mainly adopted email marketing as their major marketing channel. Recently, they have also started to leverage facebook, Display Ads to drive more customers to their website.

Pronto Cycles – Bike Sharing in Seattle

Pronto Cycles is a new bicycle-share service in Seattle. The concept of a bicycle share is to provide bicycles for short-term rentals throughout a city. The mission of the service is as a public transportation tool to aid people who may generally take the bus into the city, but still require additional transportation options once there. The bikes are easy and quick to check out and are intended for short term trips between destinations.

Pronto Cycle share is pursuing the general commuter as their market. They are disrupting the transportation market by providing a new service which enables people to travel to locations in lieu of personal vehicles, taxis, or buses. Although some users of Pronto Cycles may be using the bicycles for recreational purposes, the primary intent is on disrupting the commuter travel industry. This is demonstrated through the selection of stations locations was based on the proximity to businesses, schools, and retail locations. Instead of placing stations near convenient trails for recreation, the stations were situated in order to maximize use for standard trips users might make in the normal course of a day. Additionally, the pricing structure was also determined with the goal of encouraging quick trips between stations. Instead of pricing by the minute or trip, Pronto instituted passes which grant the passholder unlimited 30 minute trips. Passes may be for 24 hours, 3-days, or 1 year. This structure is meant to encourage short trips which may have otherwise occurred with a car or bus. The education program which Pronto has instituted in order to market the system is also geared towards educating consumers about how they might be able to utilize the service to avoid making an extra trip in a bus or car.

Pronto Cycles has positioned themselves as a public service which can be used as a supplemental travel option. In order to reach their first customers, Pronto relied heavily on word of mouth, press, their website, and social media. Although bike sharing services had been introduced in other cities, Pronto found a need to educate users in Seattle about how this could be used and what exactly a bike share service was. In order to help gain input and educate potential customers, Pronto held community forums. Currently, Pronto has over 2,000 followers on twitter @CyclePronto. Additionally, Pronto made use of their website and an email newsletter list to reach their first customers before and after they launched. Due to the very public nature of the service, Pronto was able to leverage the media in order to gain exposure. In particular, by being a local service, Pronto was featured in local media columns detailing the progress towards implementing the service, and announcing public forums which Pronto used to gather customer feedback.

In addition to finding their initial market, Pronto has been continuing to work to reach more customers. In order to find more customers, Pronto has reached out through bicycle advocacy groups and social media campaigns. Pronto is working to engage their customers by providing a social media campaign which encourages users to find a specially-colored bicycle and post pictures. A large part of Pronto’s mission and method to increase users is driven by getting their users to change their habits, so their marketing campaigns have been organized around encouraging people to consider biking as a mode of transit. Pronto regularly engages with their customers in order to generate interest and keep customers returning. For example, Pronto helped encourage and sponsor a race which involved using Pronto bikes to get to different locations around the city.

 

Jobvention – Automatic Sourcing Job Board

Jobvention.com is a job site that allows small and medium sized businesses to post a job and get talent referrals in 48 hours or less. Jobvention uses a combination of search and data analysis to match talent from around the web with businesses that need help. Founded in Seattle in 2013, by Microsoft and Amazon alumni, Alvin Loh and Hui Dai.

Jobvention.com has disrupted the market with its Search String Generator, companies can simply type in the key words for a job position and receive 5-10 qualified candidate leads in 48 hours. Compared with the efficient matching service at Jobvention.com, other job search websites (such as LinkedIn, Indeed.com) depend on the job searchers to register on the website and to apply for the particular position, and the recruiters need to go through the painful process of filtering through tons of resumes manually; or the head hunter needs to actually “connect” with the people on LinkedIn to get their contact information. The search tools on Jobvention.com is quite powerful, other than the candidate pool in its own candidate pool, it can also links job postings from other websites such as Craigslist and Google Apps for Business. Moreover, it aggregates information for a single post by synchronizing messages in the Gmail inbox, and present them directly as text within the app, which saves a ton of time, you don’t need to go back and forth for a job post.

Jobvention.com is mainly after the market of small and medium businesses, and the major use case is online recruiting. To target those customers, Jobvention.com has positioned itself as between Monster.com and craigslist –– it is much cheaper than Monster.com, and more professional than Craigslist. The major channel in which Jobvention.com reaches their customers is through direct mails, other channels include Facebook and Twitter.

Entrepreneur Report – 51Zhaohu®

51Zhaohu® is  an informational and social networking channel for Chinese residents in the North America. Users can connect with the local community by browsing, joining, or creating events on the website. By registering the accounts through QQ/WeChat (the most popular social network platforms for Chinese population), the users can view and share the local events with their existing network at QQ or WeChat.

The startup positions themselves by creating a new market for Chinese community throughout North America. By fulfilling the needs of their target customers, 51Zhaohu® is aiming to connect the Chinese new comers to the domestic Chinese community to solve their social living needs, such as making new friends, sharing restaurants reviews, joining sports events, chipping in group buy, or grouping domestic travel, etc. They started to reach their first customers by creating small local offshore events throughout the universities and major global companies in North America. For example, international and exchanging students, relocating professionals and their families, and domestic tourists are their target customers.

Entrepreneur Report – Crown Social

Crown Social is a creative agency focused solely on executing social media marketing strategies. Their value proposition is to deliver powerful creativity both online and offline to influence millions of people through their technical and digital expertise.  The market that Crown Social is pursing are companies that like to take risk to engage their customers within the social space. They are not going after a new segment of customers; rather they are disrupting an existing market since they have positioned themselves as the only company that solely focuses on social media marketing. Other major players in the market such as Wunderman have advertising and strategy in a bunch of different areas which includes social. Crown Social’s expertise is that they are a pure player in the social media marketing strategies area which sets them apart. The social space is a fast moving arena and therefore, it becomes difficult for a person to become an expert in it. Crown Social does social media marketing every day and that sets them apart from other agencies who focus on many different things. Crown Social wants its customers to look at social media marketing as an opportunity to engage people and influence millions of customers. The channels through which they reach their customers are mainly inbound marketing and through word of mouth. Crown Social also invested initially in SEO marketing, so that they can be shown up in search results in Google. They also invested in events in the initial stages to gain traction to reach out to its customers.

Entrepreneur Report- Shannon Stowell, president of the Adventure Travel Trade Association

Established in 1990, the Adventure Travel Trade Association (ATTA) serves more than 900 members in 80 countries worldwide. Members predominantly include tour operators, tourism boards, specialty agents and accommodations with a vested interest in the sustainable development of adventure tourism.

The market the ATTA is pursuing is adventure travel industry. Because the ATTA has a strong orientation towards low impact travel and less harm to the environment, the ATTA also positions itself in eco-travel industry, which is defined as “responsible travel to natural areas that conserves the environment, sustains the well-being of the local people, and involves interpretation and education”. (TIES, 2015)

Ten years ago, when Shannon bought the company, adventure travel industry has already existed. However, there was no company that dealt with adventure travel seriously and the quality of the service was bad. As a result, the ATTA was unique back to that time. Now, the adventure travel industry is much more developed, the volume of adventure travel tourists is booming very fast. The globalization development also advances the international tourism.

The ATTA delivers solutions and connections that propel members towards their business goals and the industry toward a responsible and profitable future. The ATTA excels in professional learning, networking and partnering services. With expertise in research, education, adventure travel industry news and promotion, members of the ATTA receive competitive opportunities that help establish them as leaders in adventure tourism.

Because when Shannon came to the board, there were already several business partners, he did not need to find the first customer. However, their clients were not satisfied with their service of the time, that was the critical issue facing him. To deal with the issue, he began to talk to every clients and hear what their demands were, what they envisioned from ATTA. The financial cycle was bad at the first year, there was small income, so Shannon and one full time junior assistant and one half time staff had to cut down their budget a lot. By sincerely listening to people’s feedback, things began to pay back after three years. For now, the ATTA have 16 full time employees, 5 part time staff and 5 contract employees.

For marketing channels for the public, they have platforms in Facebook, Tweeter, Instagram, Google Plus and Youtube. Email is also a frequent and suitable tool for the ATTA. Now, it has 20,000 professional to register the ATTA email serve list. Since the ATTA insists on a business to business model, it develops their customer normally through one to one conversation. Built on interpersonal communications, Shannon believes that this can be a strong and competitive tradition for ATTA to compete with other companies. They use Sales Force, a tool to track customer relationship, to manage their clients. This tool helps them record all the conversations, how complexity the conversation is, how people meet, what service clients want to or have purchase from ATTA, and who to contact. The ATTA also has its own channel the HUB, The Adventure Travel Social Network, working as a networking forum and new business development tool.

ATTA Website: http://www.adventuretravel.biz/

Retention and Referral – Panel Write up

Team AlControl (Henry Olson, Carl Petrillo, Ryan Delacruz, Damian Moreno)

Panel Write up – Referral and Retention (Leigh, Steve, and Brant)

This panel was a pleasure to oversee. The three speakers had a great connection that carried the discussion with very little help from the panelists. While there were many fantastic points made, we would like to focus on three ideas that were brought up regarding retention and referral.

Retention – The best way to retain your customers is by continually astounding them with new content. As a company, you want them to be thinking about how lucky they are to have found your service or product. Retention strategies based on making it difficult for them to leave your service will work but only for a short time. When another service comes along that lets them do without you, they will leave.

Referral – Referral strategies boil down to making a great product and politely giving the client the opportunity to spread the word about you. Referral is much more effective when you simply ask if there is anyone they know who might want this product. You should not bog down the customer with survey requests on your performance as this will seem tedious and they will then be less likely to refer you to their network.

Referral – Offering a reward for referring a new client can be a great way to get people to bring in new customers for you but you must always make the reward match the target group. Brant mentioned a shirt designing company that sold $300 dollar shirts but offered a $20 referral reward. While $20 is nice for a student, if you are buying $300 shirts, it is almost meaningless. In this case, the referral reward wound up being small enough that Brant was unwilling to refer his friend as it would seem odd when his friend found out that he had gotten $20 for it.

These are just a few of the stories and ideas we walked away with. The three speakers seamed very knowledgeable and would have been easy to talk to for hours rather than just the 45 min we had.

These ads are following me

It wasn’t difficult to find a few content advertisements based on my browsing history. One of the ads following me lately is for SmartThings, a product that I discovered while doing research for class. It has been showing up regularly for two weeks. This instance appeared on the Puget Sound Business Journal. SmartThings Ad Another product that appeared today on Facebook is a Mitsubishi Ductless Heat Pump. A few days ago, I looked up Mitsubishi product specifications for one of my projects at work. Thanks for the reminder, Mitsubishi—I didn’t finish what I was working on. Mitsubishi DHP Ad Finally, here’s one more that is legitimately for a product that I shopped. This mod sofa looks cool, but the reviews for this brand were not convincing. It’s a no-go. LexMod Sofa Ad

Are the ads effective? It’s a mixed bag. We learn to ignore them because they often are irrelevant. I think more focused targeting and lower frequency could make many of them more effective.