I disagree a bit with the basic premise of the article. More companies is not necessarily better when it comes to growing a startup ecosystem or measuring its success. It might be more fun for lots of people that are playing house. Fun for what Keith McGreggor refers to non-trepreneurs. But its not success.
A better measure of quantity of a startup ecosystem would be the number of people that are employed by technology companies created within the past five years. That’s an interesting number and one that can really nail down the health of a startup ecosystem. It’s a number that you can actually look at to watch an ecosystem grow and the employees in that ecosystem are the ones that might run off and create a company at some point in the future.
Somewhere in our Twitter conversation Keith stated the following.
@lance@davidcummings someone smart I know once said: “I can’t pick the winners, but I can pick out the losers”
For someone with ten years or so of listening to pitches from startup companies and being a very very early participant in the commercial internet industry some type of outlier 10,000 hour pattern recognition has developed for me creating a rapid cognition skill on selecting startups. I am sure I am not alone in possessing this skill set. It takes someone with it about 30 seconds to identify a startup that is not going to make it. I will stand corrected if someone wants to raise their hand and say “what about this one”, but of the thousands upon thousands of startups that I have seen in business development and startup advisory roles I don’t think I have ever been wrong in identifying a startup that would not make it.
This all goes to say that a technology community should focus on startups that have an opportunity to become a business. When you get down to it the real measure of a startup ecosystem is the customer, revenue, and user growth that the companies within it obtain.
It has been about six weeks or so since I joined the CallRail team. We have made a lot of progress in that short time. Getting our arms around some high level important metrics. Tweaking some of our current marketing efforts to make them a bit more productive. Hiring Ashley Coleman to implement some marketing technologies (we don’t have that many at the moment) and really drill down on what is driving customer growth so that we can make our marketing more effective and kick revenue into hyper growth.
This week we made the biggest decision to date. We decided to organize the sales team using a sales development model. There were a lot of factors that lead to this decision. My experience watching Kyle Porter build the Sales Loft sales development organization, our investor Wain Kellum encouraging us to go down that road, and my general belief in the model. But the big driver of the decision was that our monthly inbound leads have increased 40% since the beginning of the year and our account executives are straining to pay attention to the big accounts that we want them to close and qualify new leads. We pay account executives to close deals. They need to be able to focus their time on doing just that.
So CallRail is going down the road of sales specialization. Right now we are looking for an sales development rep to join the team to respond to the healthy flow of new leads every day, qualify them for our account executives, help us map out a winning SDR sales flow process, and potentially scale into a larger role as a leader of an SDR team. And while this great article “How I Ramped Sales Development in a Month” is focused on outbound one of the first things I am going to do is have the person we hire read it. Great roadmap for a lone SDR.
Once we get inbound humming a suspect we will be ready to specialize a bit more by starting an outbound team. Just like in industrialization, specialization in the sales function is the winning road to be on.
Scott Brinker’s Marketing Technology Landscape Supergraphic is one busy chart. According to Scott the 2015 version has nearly 1,900 companies across 43 different categories. Finding one’s place in this universe is a bit like looking for Waldo.
CallRail is in the orange Marketing Operations area in the upper right in the Call Analytics/Management category. Blowing it up makes it a bit easier to find.
And when you take a closer look at it call analytics really is not that crowded of a space. Basically six companies vying for a large and fast growing market. Not a bad place to be.
The Local Search Association Conference kicked off on Monday. Part of the program is the Ad to Action Awards which recognizes innovation and helps promote the products that best drive consumer actions (calls, clicks, store visits, etc.) for local businesses. CallRail is a finalist in the attribution and analytics category. This 40 second explainer video which was part of the CallRail submission is a good quick overview of the company’s value proposition.
If you are in local marketing not having call tracking is no longer acceptable. You have to know what makes your phone ring. CallRail does that.
CallRail offers phone call tracking and analytics for online and offline marketing campaigns. Their tagline says it all. Know what makes your phone ring. Something that is becoming increasingly important with the shift to mobile and online advertising. It’s a big wave.
I met Andy Powell, one of the co-founders (Kevin Mann is the other), back when the company was a few people at Atlanta Tech Village and I was working for Half Off Depot. Engineered serendipity. Liked what he was doing and followed them a bit.
Late last year CallRail raised a $2 million Series A from Wain Kellum, Reggie Bradford, Canal Partners and BLH Venture Partners. Shortly thereafter I happened to run into Reggie and his family at the Shake Shack. He couldn’t have been more positive about CallRail so I decided to reconnect with Andy to see if he could see any sales and marketing help.
It happens that he did. We seemed pretty aligned from a values perspective. We decided to work together.
My number one objective in joining the CallRail team is to build a repeatable and scalable customer acquisition process so that we can double CallRail’s business in 2015 and then again in 2016. The CallRail team has created great momentum with a focus on friendliness and simplicity. Momentum so great CallRail could be the fastest growing Series A startup in Atlanta.
I am very excited to be a part of the CallRail team. It’s going to be a fun ride.
On the advice of my friend Dale Kirkland I decided to get my girl some decent seats to the Fleetwood Mac show last week. Never a huge Mac fan but Dale was right, they put on a heck of a show. The highlight to me was a story that Stevie Nicks shared leading into “Gypsy.” It seems that before Fleetwood Mac made it big and Stevie became rich she used to go to a store in San Francisco called the Velvet Underground. According to Nicks the store had a marvelously painted floor. Hence the opening lines of the song.
So I’m back, to the velvet underground Back to the floor, that I love To a room with some lace and paper flowers Back to the gypsy that I was To the gypsy… that I was
She went on to talk about how the big lady rockers of the day, Janis Joplin, Grace Slick and the like shopped there, but at the time she could not afford to do so. One day while visiting the store she had a premonition. That she was going to become a star and would be able to afford the clothes that the Velvet Underground carried. Using herself as an example Nicks went on to encourage the audience to follow those feelings when they happen, to devote their lives to things they are passionate about. Which gave a whole new meaning to the next two lines.
And it all comes down to you Well, you know that it does
And while she did not talk about the next line seems to be a bit of carpe diem encouragement.
Well, lightning strikes, maybe once, maybe twice
Stevie is quite the little motivational speaker when she does not have her witchy freak persona on.
Lighter Capital recently published a guide on how to choose the best funding path for your startup. It is pretty informative and outlines three funding paths that are potentially open for a tech startup. I find the guide particularly useful as less then 1% of all companies attract venture funding and it seems that nearly 100% of entrepreneurs seek out venture capital. Most companies do not raise venture funding and most entrepreneurs should not seek it.
There is a nice graphic in the guide that sums up three funding paths.
I don’t agree that companies generally raise a series A at launch and initial traction or that a series B takes place at $5 million in revenue. They both seem to come later to me.
The important takeaway from this chart is the non VC-backed path and revenue based financing. It is the path that the vast majority of startups will take and one that entrepreneurs should spend more time thinking about than pursuing venture capital.
1 San Francisco 630
2 New York 319
3 Los Angeles 160
4 Boston 150
5 Washington DC 69
6 Seattle 67
7 Austin 58
8 Chicago 56
9 San Diego 48
10 Atlanta 39
Atlanta has cracked the top ten in terms of regional concentrations of early-stage capital in the United States. Granted there is still a huge concentration of capital going to the Valley. There always will be. But I think we are starting to see the results of David’s vision, being carried out by lots of different entities across the entire Atlanta metro area.
In a nutshell they believe Fab paid too much attention to competition and did not stay focused on their core market market. Around the 3:20 mark things get really interesting when Mark starts talking about capital constraints. Capital constraints force focus, force creativity, and force innovation. Capital constraints also force you to ask harder questions about the viability of the business. Mark concludes that Fab’s issue was overcapitalization.
In his and Jeff’s point of view raising a large amount of capital increases investor expectations which in turn forces artificial growth and raises public expectations. The end result being growing too fast before a strong foundation is in place. Then things crumble.
Something to consider when big checks with high valuations are becoming more common.