Marketecture (www.marketecture.com) is a midsize business based in Orem, UT that helps clients build a successful online business presence. They do this through their best of breed SaaS technology for website design and online business management with a strong background in SEO, SEM and local business marketing strategies. CEO Oliver (Ollie) Bigler and CTO Dan Sampson recently took some time to chat with Ascent Advisor.
Peter Wride – Ascent Advisor: Ollie, I understand you have been very involved in theater, music, and currently doing improv in your spare time. How does this creativity play out in your ability as a CEO?
Ollie Bigler: I had always been fairly entrepreneurial, but I also enjoyed doing theatre, comedy, and music and I still do some. I perform at ComedySportz just so I can keep my toe in that water!
Where all of those non-business skills play into business is they all can be translated into interpersonal skills. Sales, promotion, marketing, talking about the company: my strengths are in sales. I don’t know how to program like Dan, I can’t rip out a piece of code and add it to the platform, but I can talk circles around him.
Ascent Advisor: What makes Marketecture different? What’s your unique selling proposition?
Dan Sampson: When you really break it down and look at our entire offering, we feel there are only a couple competitors who really do what we do. We not only do our client’s website presence but we also do all of the marketing. We also have all these social integrations, adding in your e-commerce and all these different aspects. There is a lot of competition out there that do one of those pieces, but no one can really encompass all of them like we have.
Ollie: That is it in a nutshell. We are not reinventing the wheel here. We looked at the market and saw that everybody was trying to build one widget a little bit better and trying to take one piece of the small business owner’s wallet. Nobody was focused on the bigger problem: all of these small business owners were hitting an apathy point very quickly because the entire system was set up so that they had to become internet experts if they were going to have a legitimate shot at getting an influential online presence for their business. And these small business owners don’t have time for that because they are trying to run their business!
Dan: My brother is a dentist, and I tell him, “Curtis, you have to do all these other things,” and he says, “Why? I just want to be a dentist!”
Ollie: No one has put the small business owner first and tried to make them successful. The fact that we sell software is secondary to our goal which is to create success for each small business owner.
Ascent Advisor: Marketecture is the evolution of an earlier boutique marketing company, E-Harbor. What went into the decision to make this drastic change?
Ollie: We reached a point with the boutique marketing services that we topped out. Marketing services is a rough business. You have high turn-over because search engine optimization just takes time, and over time it got more and more complicated, more and more difficult. Most people just don’t have the stamina to wait six months. Pay them money and then not see any results? That’s hard.
We peaked, but in the process we had started building website technology because people were bringing us their websites off the street and we couldn’t do anything with them. We started building websites as part of that, and then we launched some niche services – we launched a service for real estate agents, one for real estate investors, one for mortgage brokers – and so we’re generating leads and doing marketing for these types of customers and that’s how we were able to see there was a real need that nobody was addressing. That’s how we got started.
This was Dan’s brainchild, he saw the need to build it in this modular format so that we can plug in the extra pieces that people want. We envisioned all that, we started working in it, and then when we got to the point where we felt like we had a viable product, we decided to change the entire business model to where all marketing services would only be offered to customers who came in the front door on the software so that we could control it better. We just flipped the business model on its head.
Dan: It really came about as a services company. We realized if we go from 100 sign ups this month to 1000 next month that means I go from 20 employees to 200 employees. It just wasn’t scalable.
Ascent Advisor: You say that casually: “We just flipped the business model on its head.” No big deal.
Dan: No, that’s really what we did. We said it’s going to be rough, but let’s do it. It was a bit cavalier.
Ollie: We had a little bit of help from the economy. Because the real estate agents were a large part of the business at E-Harbor when the housing market collapsed all of the real estate agents stopped having budgets to spend on marketing. We had planned at the time to do a slower transition but the economy had other plans. It literally just bottomed out in about 4 or 5 months. So, okay…
Dan: Now’s the time.
Ollie: …let’s go ahead and do it.
Dan: And the other thing Ollie was saying: we had 3 or 4 different platforms at E-Harbor. Usually the two hardest groups to buy in to a major change like this are sales and support. However, support was going crazy because they had to answer the phone and support multiple technologies. It was a nightmare.
It was harder to manage and everything. So we said we’re going to one platform and support said, “SIGN ME UP! Let me know how we can get everyone else and migrate them onto this. We’ll do whatever we can.” It was really easy for them to buy in, and sales just kept leads coming so they didn’t care. As long as they were getting leads, as long as they were working and were successful, they didn’t care where it was coming from.
Dan: We recently had a feature release discussion and someone in the group raised their hand and said, “Hey, I don’t do this personally and I don’t quite understand it. Therefore we’re failing. Let’s start over. If I don’t get it and my company’s building it, then your brother the dentist isn’t going to catch on to it. Let’s retool it.”
Ascent Advisor: What evidences do you see today that focus on small business owners still alive and well?
Ollie: Our customers are extremely sticky. One aspect of focusing on the success of the small business is having a very robust customer support system because we already know these customer’s mindsets: no matter how good we make our software and how seamless, there’s still going to be a good 35% of the customers that don’t want to go in and click any buttons at all. They just want to talk to somebody. They just want a shoulder to cry on.
Dan: It’s THRIVING. When we sit down and talk about new features, we say: “That’s great, but how’s this really going to help?”
Ascent Advisor: How do you create a culture where people raise their hands and say, “I don’t get it” or “I don’t agree”? That requires a lot of trust.
Dan: The key is you actually have to listen. If you’re going to try to create this culture and someone raises their hand and your response is, “Great, now shut up – next time don’t raise your hand,” it isn’t going to work!
You know, we have monthly lunches and if Ollie is up and explaining something and he says it wrong I’ll stop him and say, “Hey, not quite right!” and explain it. You don’t write it in the manual: “Raise your hand if you have a question.” You just do it.
Ascent Advisor: What is the right mold for somebody who’s coming on to Marketecture? What are you looking for in an employee?
Ollie: Number one thing that we have learned when it comes to hiring: personality and fit are ten times more important than skill set. We’ve spent a lot of time discussing and analyzing what type of person fits with our particular culture. We’ve had to learn this lesson a dozen times because we will make an exception for one guy because of his amazing resume. This guy is going to change everything!
Turns out it never, never works because it’s just not the right fit, they don’t buy in and the synergy is just not there. You know, there’s a collaborative energy that just occurs when everybody likes each other and likes working together and trusts each other. Things just happen. Somebody has an idea, somebody bounces off that idea, and pretty soon you get this brainstorming happening and we’re off to the races. But when you’ve got a personality that doesn’t fit, no matter how good the resume is, that critical element is not there.
Dan: It deflates the balloon faster than you can ever imagine.
Ollie: We had a bad experience with this recently with an executive we brought on. Turns out that the rule is right no matter how high the stakes are!
Ascent Advisor: What’s the vision for Marketecture going forward? What is it that you are aiming towards, that everyone here is pushing towards?
Ollie: Our big hairy audacious goal is 100,000 recurring, loyal customers by 2013.
On top of choosing a fairly unique approach to the market in terms of the software, our business model is also very unique in that we are not doing any direct marketing whatsoever. We’re doing all of our marketing and customer building through partnership development. We’ve layered in an aspect to our software that allows us to offer partnerships to companies who have small business customers already. Some just want to resale and refer clients to us. Others want a full private label where to their customer it appears as if this is a new value added product from the company, and we love it both ways.
We’re doing a lot of partnership development with Fortune 500 companies. Those take a long time to close.
Dan: We’ve found that going after the right partnerships is key to our business and our sign up rate. Partners that not only that can drive sign ups, but drive quality people that we can help.
Ascent Advisor: You’ve gone through tremendous growth (recently #775 on Inc. 5000) What has been the biggest challenge that you’ve seen from fast growth?
Dan: The biggest hurdle is staffing. Getting the right people on the bus, as cheesy as that is; it’s always the hardest thing. I really want someone who will love the product and almost take a bullet for it if ever needed.
Ollie: Something that we’ve really focused on for the last year is learning how to run a mid-to-large sized developer group. This has been a real amazing learning experience– we went from Dan hammering it out and a couple of developers assisting to every developer owns their piece of a software development team. It’s pretty awesome because the stuff they’re turning out now is coming out faster than ever and the quality is pretty amazing.
Dan: It’s funny that you would say that was our biggest hurdle. That should have been my answer!
Ollie: The bigger issue could be learning how to run a larger company. Everybody has had to learn that.
Ascent Advisor: What’s one challenge that the leadership team faces that you wish the employees understood better?
Dan: That’s a GREAT question. I think one thing would be understanding and better comprehending the financials.
Ollie: Finances. Most employees just don’t grasp the concept that you have to have money in the bank to make payroll. They just don’t think about it. Look, it’s a big company. We’ve got 65 employees now. You guys are rich!
Dan: You’re taking home a lot of money. You’re in charge; you must be making more than anyone else!
Ollie: So we try to adjust the mindset through equity. So we have stock options/plans, things like that. We try to help them all to think like owners but it is still a challenge.
Ascent Advisor: What is the next hurdle for growth at Marketecture? What’s the next challenge you see coming your way?
Dan: You know, the next challenge would really just be scaling properly. We feel we have everything in place technically that will scale. We have a lot of partnerships lined up and ready to go and our pipeline looks great, our sales team is now scaling and growing like crazy, so it’s just a matter of properly executing.
Ollie: Very clearly our next hurdle is going to be the next large partner that we sign. We’ve got like three or four on the hot burner. We’re just working our way through the change. We don’t know when that’s going to happen. And that’s a problem because as a fast-growing start up, cash is king. We are always on the razor’s edge or profitability and cash burn. Once we sign this large partner we have to go into a new mode where we are trying to figure out how we spend ahead of the curve, because you don’t want to drop the ball. You want a partner of that size. That could really make or break it.
Dan: One of the bigger things we’ve learned are the metrics to scale properly. We know that when we inject these 5000 new customers that requires 20 additional support staff (instead of 40 or 60). It is still a risk of spending ahead, we’re still probably going to miss the mark by hiring too many or not hiring enough, but it’s going to be a lot more precise than it would have been years ago.