Ep 12 Dave_Clean
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[00:00:00] Corey Quinn: Welcome to the Vertical Go-to-Market podcast, while you'll discover new opportunities to grow your business. From seven figures to eight. From the world's most successful B2B SaaS and agency owners and executives, I'm your host, Corey Quinn.
[00:00:18] Today I'm joined by Dave Hansen. Welcome, Dave.
[00:00:22] Dave Hansen: Hey, thanks for having me on the show, Corey. I appreciate it.
[00:00:24] Corey Quinn: I'm super excited for the conversation that we're about to have. Uh, but first, would you mind introducing yourself to those listeners who may not be familiar with you and your background?
[00:00:35] Dave Hansen: Yeah, of course. Happy to. I'm currently the, the, um, head of, uh, well, I'm the president of Client Tether. We're a sales automation CRM platform that, uh, about four, four and a half years ago went vertical. So, uh, uh, excited to be on the show and kind of talk a little bit about the journey. But, uh, you know, my background has been in, in sales.
[00:00:53] I. My first sales job was, I was self-employed at age five, snuck outta the house and was trying to earn money for baseball cards. [00:01:00] But it's been, you know, it's a long story. Maybe we revisit that later. It's pretty funny, but I just, I started, uh, into that world and kind of stayed, you know, software EdTech.
[00:01:08] Uh, translation services. I've led a lot of organizations. I've started companies, uh, and, and so I've, I've been in this world of business for a long time. I'm a passionate, uh, baseball guy. Just retired as a high school baseball coach after my last season, last su last spring. I, I don't know how I squeezed that in with running a company, but, you know, you do, you do what you gotta do.
[00:01:28] But I, you know, I love, love that kind of stuff. Dad of four kids been married 20 years in a couple of months, so just, uh, light life is treating me very
[00:01:35] well, Corey.
[00:01:35] Corey Quinn: What a full, full life.
[00:01:37] Could you share a little bit more about what Client Tether does today and and, and who do you serve?
[00:01:41] Dave Hansen: Yeah, of course. Uh, so clientele is a, uh, you know, there are lots of CRMs out there, right? But we're, we're a CRM that has sales automation, omnichannel communication built into it, and it was designed specifically for service-oriented industries. we found there, there are a lot of organizations that.
[00:01:56] Or CRMs that are built for kinda the big box pharma, high tech [00:02:00] companies, they're great. I've been an admin of some of 'em, Salesforce Dynamics, uh, you name it, I've even worked in Goldmine, right? So there are a lot of good CRMs. The problem is they have overcomplicated data structures and their sales automation is really poor.
[00:02:12] Uh, and the home service space, they are a lot of home service tools that try to be all in ones. But they're, you know, they're really good at. You know, quoting and operations management and they're terrible at sales. And so we built a tool that's actually phenomenal at automating the sales process. And it's also designed for multi-unit businesses, so dealerships and franchise systems.
[00:02:29] And that's kind of our bread and butter. And when we talk about verticalizing, that's, that's really how we, we identify what we should do cuz it was what we were absolutely hands down the best at. So we just focused on
[00:02:39] that.
[00:02:40] Corey Quinn: For contacts, for listeners, could you share, or what can you share about the size of client Tether, maybe the, the number of customers or, or employees, revenue, whatever you're comfortable sharing.
[00:02:51] Dave Hansen: Yeah, sure, sure. It's a private company. We don't share tons of detail about that. But, uh, as an organization, we're, yeah, we're a couple million dollars of a, of recurring revenue now. [00:03:00] Um, we're, uh, so. We're still growing, uh, but uh, compared to where we were, you know, four years ago, we, we've skyrocketed, kinda hit an inflection point, uh, about about 11 employees, 12 soon.
[00:03:11] Uh, and, um, yeah, about 1500 business entities running their businesses off of our platform.
[00:03:18] Corey Quinn: That's fantastic. That's fantastic. We'll dig into that a little bit more as well. And then one more sort of contextual question is what is your, uh, can you tell us about your role there as the president? What, what did, what are your, uh, responsible for? What do you, what do you do? What do you focus on?
[00:03:33] Dave Hansen: Yeah, thankfully, it's, it's my, the, the list of responsibilities are shrinking as we grow a little bit. You guys all can probably empathize with that. Uh, I'm, I have one hat on my head, but 20 that I wear emotionally a lot, but, uh, primarily in charge of now sales and marketing. Uh, and, and a lot of strategy.
[00:03:49] Uh, before it also was HR and all sorts of other things, but we've fortunately got people that are taking care of a lot of that stuff
[00:03:55] now.
[00:03:56] Corey Quinn: So let's, let's talk about the verticalization of your business. Maybe [00:04:00] take us through the, the time maybe when you were coming on. At that point, had Client Tether really focused, uh, the business on a specific vertical, or was it more multi vertical at that time?
[00:04:12] Dave Hansen: Yeah, that's a great question. Well, I think we had the same conundrum every business has. That creates a valuable product, right? That, yeah. Especially in the cr r m space. Everyone needs it, right? Everyone needs sales automation tools. So, um, when I fir, when I first joined, and that, that's, that was the, the, the project to tackle, which was to figure out where is our best product market fit?
[00:04:32] And the problem is, is everybody wanted it, you know? Chiropractors and dentist offices and, and, and, uh, home, home service companies and anybody, you know, uh, uh, colleges. And people wanted to use the platform because they saw the power of the sales automation. But, um, so we really didn't have a focus. It was like what most people do.
[00:04:50] Oh, you wanna give us money Suite? We'll take it, we'll take it, we'll take it. Uh, which as you, uh, probably are gonna drive us toward. It created a whole host of, of challenges, uh, [00:05:00] that, that really stymied our
[00:05:00] growth.
[00:05:02] Corey Quinn: Could you share some of those challenges that led you to ultimately decide that you need to make more of a, a decision to focus?
[00:05:11] Dave Hansen: Oh, a hundred percent. Yeah. That's, and, and, and I, I share that because I know anyone who's listening that's running a business, you're probably hitting the same wall. So we, uh, the, the challenges are that w the, the support process, the implementation, that has to be very different. If I'm working with, let's say, a.
[00:05:27] College is recruiting, uh, recruiting students to come, uh, actually they're enrollment advisors. I can't call 'em recruiters, but you know, they, they, they're, they need that, they have a very different set of needs and different set of skills and also different IT infrastructure that you've gotta support.
[00:05:41] Uh, if I'm working with a, a doctor's office, you know, that's a small, you know, single, single physician practice or a chiropractor, well, they've got different considerations, let's say hipaa, that you've gotta make sure you're being, you're being, uh, you're paying attention to. There, there are a lot of different things.
[00:05:54] Every vertical has a, a different set of. Technology requirements, a different set of lead [00:06:00] sources that are coming into the platform. And as we, as I started to evaluate the, the mar, like how that was impacting the company, it became pretty obvious that it's time to stop trying to be everything to everyone.
[00:06:10] Because our, our dev efforts were spread so thin. We were, we were not getting very deep into what I felt were priorities. What we all as an executive team felt were our priorities, which was, you know, developing the platform, getting really good at certain things and just didn't have the time cuz we were spread so thin.
[00:06:25] Doing one-off request to try to make it work in other spaces.
[00:06:28] Corey Quinn: What was the business impact to being spread so thin over time? Like how did that impact the company?
[00:06:36] Dave Hansen: I, I won't share the details, but, uh, the, the revenue, the revenue is not where it should have been after four years of being a business. and it also impacted the team. So the development team was stress stressed to the max and they felt like they were not getting anywhere cuz they really weren't.
[00:06:48] Cause they were really just kind of taking one-off request as they came in rather than having a structured roadmap and a process to, to, you know, build sprints and strategy and, and deploy strategically to drive additional value and revenue [00:07:00] through the dev. Um, so, so those were, those were some of the impacts to us and, and just, uh, you know, not being able to support the platform like we wanted to.
[00:07:08] Every single account had a totally different set of needs and support questions and problems and, and technology infrastructures, which that makes it very difficult to support a
[00:07:16] platform.
[00:07:17] Corey Quinn: That makes a ton of sense. It seems like at that time it was, we have to focus on one thing. why did you guys choose franchise?
[00:07:24] Dave Hansen: Yeah, so we, we chose, uh, and, and even in franchise, which a specific vertical right? Or a specific use case. So, Inside of, inside of franchising, and in fact, I'll, I'll share a little of metamorphosis of this too. Uh, we're extremely good in home services. So we've got proposal platforms and payment processes and QuickBooks online, all sorts of different tools that that help a, a whole, you know, I say a painting company or a painting franchise, top to bottom, run the business.
[00:07:47] Even things like royalty reporting, which are specific to franchising, but very important. Um, so, uh, We decided on that because nobody does it. So all the big box CRMs, any of the, [00:08:00] the home service tools, they're good. but the problem is the data architecture is broken, so they actually can't, without, even if you spend, I've had people tell me they've spent seven figures, heavy six figures trying to make a tool like Salesforce work and franchising.
[00:08:14] You can sort of cobble it together and then you spend that kind of money, you have to have a full-time admin to try to. You know, push buttons and constantly tweak things to make sure it's working properly. Uh, if somebody sneezes on the back end, the whole thing blows up and you have data flowing into the wrong accounts and you're breaking contracts.
[00:08:28] Like it's scary what people are doing with those tools cuz they think it's the best. But, um, it's the best for pharma cells. It's the best for tech cells. But we realize that I was, we were beating people like we've, we've dislodged. Salesforce, HubSpot, like if you look at the, the entrepreneur rankings, we outrank both of them.
[00:08:44] Uh, actually no, HubSpot might outrank hub, but you know, we have a lot of people that we transition away from HubSpot or Confusionsoft, like these big CRMs, everybody knows because they're not, they're not a fit and, and they're really causing frustration, they're difficult to use. The data architecture's messed up where if [00:09:00] I'm a home service company, a lead is a contact, it is an account and it is an opportunity.
[00:09:05] And those other CRMs, those are four different data tables and four different tabs. And, and a home service pro's like, yo, I just want to go clean a carpet. I don't wanna spend 30 minutes preparing to clean a carpet by clicking buttons and, and going to different tabs and flipping switches. And that's what they get, kind of UI soup, uh, which is really difficult to run a, a service oriented
[00:09:23] business in.
[00:09:24] Corey Quinn: That makes perfect sense given my familiarity with that market as well. So it, it seems like you were able to uncover a very clear. Client or customer or market problem in this kind of UI soup, they, they didn't want a more simplicity, straightforward platform, but still built for home services. You also had a founder, Conrad, who had a background in home services and in franchising and that those kind of stars aligned and said, well, well we have all this, this in-house knowledge and exper experience.
[00:09:57] Um, we might as well focus on [00:10:00] franchise. Is that kind of. Paraphrasing, but does that capture
[00:10:03] it?
[00:10:04] Dave Hansen: Oh yeah. And also market, market fit. Like we had clients like our bis, our best clients were in. In that space, our lowest maintenance clients, we had clients that had, I don't know, 70 locations deployed with our software and they were calling us with much less frequency than the single chiropractic office we worked with because of product market fit.
[00:10:23] And so, yeah, that, that was another indicator. Hey, we've got a, we've got a shift here and just focus on where we've got the most revenue opportunity, the best, the best differentiator. Um, yeah, cuz there are a whole bunch of tools that can do what we do maybe in a specific vertical and they don't need the multi-unit data support structure.
[00:10:40] That's fine. Then they should use those tools.
[00:10:43] Corey Quinn: How did you transition the company from a maybe a generalist to a specialist in the. A franchise industry, for instance, did you just fire all your non-franchise clients or how did you approach that transition?
[00:10:55] Dave Hansen: No, no. We're our, one of our core values is, is to, to really partner with our clients, uh, and make [00:11:00] sure we help them succeed. So, so, uh, only in a couple of rare instances have we ever had that conversation. We said, look, We're not a great fit. You're, you're, you need something we're not willing to do. So I, I will recommend three other platforms that you ought to give a look at.
[00:11:12] Try this one, this one and this one. I'll introduce you to my friend who's the best HubSpot integrator in, in the Rocky Mountain area. Like, have a conversation. Right. So, uh, but you know, even if we were to say farewell, it's, it's usually, you know, intro taking 'em out of our hand and putting 'em in someone else's, but it was more of an issue of marketing focus and sales effort.
[00:11:31] And design and de and development that, we didn't talk about that before, but when you're trying to sell to everybody, your marketing budgets are disaster. Your PPC and your SEO is a nightmare because you're not really focused. So your poor, your poor marketing team, if you've got one, if you're big enough, they're a little schizophrenic because they feel like they're trying to write content all over the board.
[00:11:50] So that was really helpful for us. Being small, you know, we didn't have to worry about 7,000 keyword. We focused on a dozen, a 20, 30, 40, like specific words that now. Really [00:12:00] aligned with what we were doing. Our PPC got very narrowed in, focused our event Cal, our calendar events we went to, it became obvious where we should spend our event dollars and budgets there.
[00:12:08] Our travel became less, less, uh, crazy or at least the, the requirement for travel became less crazy cuz we were, we weren't going to the big c r M shows. We didn't care. Um, in fact, in fact, if you call me, uh, and you wanna use my CRM and you're not a target client, I will probably disqualify you on the call honestly and kindly, and then point you in the right direction.
[00:12:27] Uh, so it really helped us a lot, even in the sales flow.
[00:12:30] Corey Quinn: How did you begin to. Enter into the franchise market. Given this decision, the strategic decision to focus on franchise, how did you begin to build, uh, relationships, build momentum within franchise?
[00:12:45] Dave Hansen: Uh, that's a great question. Well, uh, I'd also do a, yeah, I've, I've been a sales consultant for, for many years as well. The, the advice I would give people, and I took my own advice, is talk to my clients. Like I, we had ideal clients, so I said, Hey, where are you guys going for information? Where, what are your [00:13:00] watering holes?
[00:13:00] What are the events we should be going to? And just kinda listen to them. We built strategic partnerships in the industry with fantastic service providers in marketing and, and finance and all sorts of other things that. Uh, attorneys people that said, Hey, you guys are the right fit for this space. I'm gonna refer all my clients to because I want them to succeed and know, yeah, I wrote their contracts, and why do I care about c r m?
[00:13:21] Because they need something to enforce the, the, you know, the, the rules of their, their franchise and something that's actually designed for them that won't. Bankrupt them. So, uh, yeah, so that was, you know, strategic partnerships was key. But then listening to the market and finding out where we sh where we belonged, where, where are the right events to go to, where should we spend our money?
[00:13:39] And, and that, that helped a lot.
[00:13:42] Corey Quinn: How has becoming a franchise focused software business really helped your, your ability, your business's ability to grow?
[00:13:51] Dave Hansen: Yeah, it's, it's scale. You know, all, all those things that we just talked about. What it does is it isolates specific needs. And so even on the sales process, like our [00:14:00] sales group, uh, the, the way that we approach the market, our process, we use our own tools. So we create scale, uh, because we have automation that's, that's really easy to deploy, but.
[00:14:08] But it made it a lot easier to, I didn't need to have 37 people trying to do one thing, um, to try to capture the market. We could get very specific. Uh, and generate specific leads. We knew which people to partner with, um, because we knew that they were the best in the industry. So, and then, then also we knew that the events to go to, so we spent our time and money at these events and didn't have to go to everything else.
[00:14:29] So being focused on the vertical made it very easy for us to start to penetrate. And so we started showing up to the conferences. Like the first real event that we went to after making that decision was, um, I f a. Uh, the big convention is actually in like a week and a half. So, and not from this recording day, not from the posting date of the podcast, but it's the, it's the show where kind of everyone shows up.
[00:14:51] Not everyone, but a lot of people. So that was, that was where we decided, hey, we're gonna, and double down here, make sure we have a presence. And, and frankly, the first time I went, it [00:15:00] was also, I was a bit of a rookie. You know, Conrad, he knows the industry's been doing it for 27 years or something, but I had to go and talk to everyone that I could and listen and learn and figure out how they operated, what their needs were.
[00:15:11] So it was also a really good experience for me just to shut up and listen for a little while and, uh, make good
[00:15:15] context that way.
[00:15:17] Corey Quinn: I'm curious, did you have any direct experience with franchising prior to this role?
[00:15:22] Dave Hansen: Uh, every now and then I'd go buy a burger at a franchise or, you know, actually, I, I didn't know a darn thing other than what I'd learned from Conrad and just being, being friends, like hearing, hearing his experience. I understood a basics about the model, but I. Yeah, there. I'll share a funny anecdote with you.
[00:15:36] We've, we've added a little bit more focus to the platform even within franchising because we, I, I, I, uh, lost my ignorance, uh, in, in large re respect to the franchising industry and how it worked. So, um, yeah, that, that was, I didn't have any clue before I.
[00:15:51] Corey Quinn: Would you say that franchising has an insider's language that people who are not enfranchising don't use?
[00:15:58] Dave Hansen: Oh yeah, I don't, do you speak any other [00:16:00] languages, Corey, or, uh,
[00:16:03] Corey Quinn: Yeah.
[00:16:03] Dave Hansen: because I, I speak. Okay. I speak, I speak Spanish. So, uh, even though I'm fluent, people that like, I, I can carry on a good conversation for a while, but people can always hear the flags of, oh, that's a gringo. Like, you use different constructs. You describe things differently.
[00:16:18] There, there's specific jargon that they use, EAs and Zs and stuff like that, but, But the way you talk about things, like, I can hear a phony in a second now, now that I'm well versed in the industry, uh, because I can write, I see, oh, they have no idea how that works. Like you can just kind of tell the way people talk.
[00:16:34] So a hundred percent. And I think every industry's that way. The, the translation localization industry is that way. Uh, you can spot a fake pretty fast when you've been in it for a while. Ed tech, learning and development, they're all the same. A high tech, you can easily spot a fake cuz they have no idea
[00:16:47] what's going on.
[00:16:48] Corey Quinn: How important is it for Client Tether or a business that is FOC trying to focus on a vertical to be able to authentically speak that insider language?
[00:16:58] Dave Hansen: Oh, a hundred percent. It's so [00:17:00] important. You, you've got, and it's because the people that people have to trust you, like trust. I'm gonna write a book on this, but trust is the, is the, the commodity of the selling process, right? They have to believe one, you understand them and what their needs are. And if, if, if you're, if you can't use the right terminology and get on the same page with me about that, then I don't really trust you.
[00:17:19] I'm gonna hold back and I'm not gonna buy, doesn't matter what your price is or how shiny the object is, I'm just not gonna do it. So I think it's it's critical, mission critical for the marketing team and the sales team to be very well aligned around industry
[00:17:31] terminology.
[00:17:32] Corey Quinn: Now that you're focused on franchise and have been for a while, how do you track new franchise clients?
[00:17:37] Dave Hansen: Oh, we use our crm, uh, that we own. So, uh, yeah, so we have, we have, you know, target accounts that we wanna work with that are ideal, but we, we keep tabs of them inside of the platform. You know, they have accounts, we can see who's got accounts, uh, the types of businesses. It's, so, it's all within our platform.
[00:17:53] Uh, an an interesting anecdote that I wanna share with you, Corey, is about a year into this, this, uh, verticalizing of our [00:18:00] business. Um, I had somebody reach out to me, excuse me, and said, Hey Dave, uh, I've been seeing your content on LinkedIn. Can I use this tool to sell franchises on the franchise development side of things?
[00:18:12] And I said, that's an interesting question. How does that work? So this lady, Janice, she's awesome. Janice Charles. So hopefully she listens cause I wanna give her some love. Um, So she said, well, this is how it works. And she walked me through a process. She'd been doing it for 20 years. So she was an expert.
[00:18:27] And I said, oh, well we already have all those tools in one place. She's like, what do you mean? I was like, well, we do this and this and this and this, and here's our vertical pipeline. We can easily adapt this, that I don't even have to code anything. Our platform does it. And she's like, show me. So I showed her and she's like, oh crap.
[00:18:40] You've got, I've, I've got five tools trying to do what you guys do. And how much is it? She's like, what? You guys are undercharging? I'm like, I don't care. That's the price. So do you want it? And it was really a fun exchange and she know, she, and she gave us great feedback about ways that she used the system and, and that opened up a door for us within the franchising space.
[00:18:58] That's our fastest growing vertical. [00:19:00] Now, three years later, I, we have, I probably three or four, maybe five referrals a week that come through sometimes from people saying, Hey, just work with Dave. Just work with clientele. They're the best at franchise development and sales, whether they're brokers or franchise organizations.
[00:19:13] We got a, you know, a large, uh, fast food organization coming to us that heard about us from a, from somebody like it's this word of mouth is starting to spread now. And that's an area we're really doing great is in franchise development. That came about from a random conversation from
[00:19:26] a LinkedIn post.
[00:19:28] Corey Quinn: Isn't it interesting, the sort of the side and unintended benefits that happen when you specialize,
[00:19:34] Dave Hansen: A hundred percent. Yeah. You get exposed, you're in the, you're splashing around in the pool with all these people and eventually they're like, oh, wait a minute. I, I, I see you now and now I see that I've been missing out. But if you're not in the pool, I'm making a little bit of noise. No one's ever gonna know.
[00:19:49] Corey Quinn: What type of, um, marketing do you do for Client Tether? You mentioned you go to conferences and associations. I want to dig into that in a minute, but do you do typical inbound marketing, outbound marketing, [00:20:00] any type of campaigns to drive leads?
[00:20:03] Dave Hansen: Yeah. Well here's the trick. When you get into tight niches, uh, sometimes your traditional. Marketing strategies don't work as well. So, uh, I've, I've been in another industry, so localization for example, is very easy and I help them actually verticalize verticalize as well. It's another story for another day probably.
[00:20:19] But, um, they, you know, they're. 400 ways you can translate or different types of projects. But we helped them really start to narrow their focus on learning and development content and, and then, then that, that helped to completely change the nature of the company, um, with clientele. But, but even there, PPP C worked okay.
[00:20:38] Right. Your traditional marketing worked okay. In, in, in our case, we found that that, uh, Google PPC was pretty much a waste of money because a lot of the key terms we were using to try to hit our target market, they were so, they were generic enough that they were attracting all sorts of folks. And I was like, I don't, I don't want an elevator.
[00:20:56] Sales company using my platform necessarily. You're not a fit. Like [00:21:00] I'm not trying to attract you, but it was, there wasn't an easy way to, to really segregate the terms enough. Uh, we still have kind of a dr, like a very maintenance level of pa paper click, but it's, it's almost inert. Uh, there were a couple of specific vertical channels we found that worked very well.
[00:21:15] Referral partnerships has worked best for us. I almost hate to say that, but you know, if you wanna, if you wanna replicate, you can. In this industry, I don't, I don't mind if my competitors listen in, uh, they should probably take note cuz it works very well. Uh, but the, but that's probably the best in industry, uh, shows referral, like asking for referrals from our clients.
[00:21:32] Usually when you're talk, it's a pretty tight group of people and so you do often don't even have to ask them when you fix their problems. Uh, brilliantly. They want to tell people about it because they're problems that are pretty
[00:21:42] ubiquitous.
[00:21:44] Corey Quinn: How big is the addressable market for client tether round numbers as far as the number of businesses that you would love to have on your platform,
[00:21:53] Dave Hansen: Oh man. So well, the, the addressable market in this, this vertical we're focused on right now. You, you've got about. [00:22:00] About about 5,500 franchise, uh, businesses out there, give or take. Uh, some of them would only be franchise development clients for us. Like we don't do quicker. There's no point in having a CRM if you're a, you just need to point a sale.
[00:22:13] So, uh, uh, but, but, uh, they're probably, I don't know, a third of that number are home service, personal care, pet care, elderly care type service concepts, and they could all desperately use us. And some of those have. 500 units, uh, in the United States. So, so it, it's, it's a little bit misleading to think, oh, 5,000, that's a pretty small market, but really, you know, there that, that represents hundreds of thousands of locations that could be on our platform.
[00:22:37] So it, it's a fairly
[00:22:38] decent market.
[00:22:39] Corey Quinn: yeah, no, I, I think that supports the comment you made, which is that traditional inbound and outbound, specifically inbound marketing isn't the best weapon I would consider for trying to make an impact in this
[00:22:53] market.
[00:22:54] Dave Hansen: Mm-hmm. Yes. But I want, I want to add a caveat on that because that's, for us in this particular industry, [00:23:00] what makes it difficult too is, um, you know, traditional list development, uh, organizations lead four 11, uh, ZoomInfo, groups like that. There is no way in any of those platforms, uh, seamless ai, you can't filter down to franchise folks at all.
[00:23:15] And so it, it's just not a filter that any of 'em have. And so for us, they were all useless. So your traditional outbound emailing. I'm not saying those don't work. I'm saying for me, in our industry, that didn't work. So, uh, but we tried it twice because I was like, ah, that didn't work. But it, it should, I know it can work.
[00:23:29] Uh, cuz in other industries it does, but for us it did not. Uh, but that was because there was a limit of our ability to gather proper data. Um, you know, working in the industry for a while now we have great lookalike audiences, uh, because we have great clients, clientless and, and, and lots of folks we've reached out to and have, you know, valid contact information.
[00:23:45] So that, that helps a lot. When you're doing your marketing, but you have to get that information first and really know your market first. Else. You can't even build a decent lookalike audience cuz they're not, they're not homogenous. You need to create a homogenous
[00:23:56] group to do that.
[00:23:58] Corey Quinn: So in those situations where you're [00:24:00] unable to sort of buy off the shelf a perfect set of leads or, or contact information, what did you do in that situation to build the list?
[00:24:08] Dave Hansen: Um, events we went, we knew which events they were gonna be at. So it's about finding the watering holes, right? You have to know, uh, where, where are they going to get their information digitally or physically, or who do they listen to or their podcasts. Do they, are they listening to Corey Quinn's podcast?
[00:24:23] And, and if so, can I be a guest there? Right? Like, you have to find the channels that they're listening to. Then you have to get in those channels. And so we went to events to start. And at the events here, the crazy thing is a lot of folks, when you go to events, they, they sit behind a table. They put like a, they put like, Hey, we're giving away an iPad, like on some card.
[00:24:41] And they're like, yay, we're the best. It's, it's a scooter. Uh, and then they sit there and wait for people to come to them. Uh, that's not how you succeed at any trade show or event. And then when, when the, the, there's that obvious part where everyone's in the classrooms, the breakouts, and then all the vendors are standing around.
[00:24:57] Everybody sits down and gets on their phone and starts answering [00:25:00] emails. I don't, I, I went around and met every single person cause I wanted to meet, you know, listen to their business and find out where there were integration points. And, and some of our best partners have come from me chatting with some stranger on an escalator at a conference or me walking around and meeting them and genuinely being interested in hearing what they have to offer.
[00:25:16] Because, uh, when you're, when you're really trying to build up expertise in an industry, one of the best things you can do is when you talk to someone who's not a good fit. Walk them to someone who is, and so when I talk to people, clients, or otherwise, I'll intro sometimes end up introducing 'em to two or three different experts in marketing or in technology management or something else.
[00:25:35] And I wanna know who the experts actually are so I can have good re a good rapport with them. Uh, because they'll also move, you know, they'll change jobs in two or three years and then they'll say, I need to talk to Dave cause I need that sales automation platform stat. And, um, and, and they've left a good impression because I, I introduced them to somebody who could help them at that
[00:25:52] time.
[00:25:54] Corey Quinn: How important is it for Client Tether to be associated with if [00:26:00] a, in this case, for franchise, which is the big association, to go to the conferences? How important is that for your business development?
[00:26:07] Dave Hansen: Uh, it's important. I, a lot of people want to put a lot more value on like the, if you're not there, nobody knows you exist. That's not necessarily true once you've got a foothold in the industry. But if I didn't show up, I'd have a lot of people calling me and texting me and saying, Hey, everything. Okay?
[00:26:20] Where's clientele? So, so there's a little bit of value to the presence play, but it's really important because that's where everybody is and the energy it requires to get access to the people. Like I, I bumped into funny story, like I was new and ignorant. My first show I literally bumped into a guy who's like the grandfather of the franchising industry.
[00:26:39] He's like super influential, really nice guy, lovely family. Like I really like, he and his wife were awesome. The Fishman's, the, uh, Fishman pr I bumped into him walking to the bathroom in this, this bar where I was hanging out with some people before the show started the next day. And I was like, oh, so sorry.
[00:26:53] Uh uh And he goes, yeah, snow worries. Nice to meet you, Brad Fishman. And he leans back cuz like he knows he's. Who he is, and I [00:27:00] didn't. And I was like, oh, nice to meet you. Oh, and I'd met his son at an event right before this one. I was like, oh, you're Zack's dad. And he was like, what? What the hell? Zack's dead.
[00:27:10] And he walked off and I was like, oh no. Like, I've just, just pissed this guy off. His wife comes over at later Sherry, and she's like, she's crying, laughing, and she gives me a hug and she's like, he's still over there. Like, his whole world just came crumbling down. They're they're friends now. Like, it's really funny.
[00:27:23] But, but I, I, if you tried to call Brad or Sherry fisherman to get an appointment to try to tell them about how awesome your services were, they're so freaking busy. They're nice people. They don't have time for that stuff. So, but I bumped into 'em and then gave his wife a, a hug and. And got to know the family at this, at this bar, at an event.
[00:27:40] Like that's priceless stuff and you can't undervalue that. And, and that's what you've gotta do is find out, you know, who are the players in the industry and, and figure out like, you know, Jordan Wilson for example, you know Jordan real well, great guy, really influential and you know, I met him at the same event and then later on, Gabriela Ferrara and, and the team and have bumped into them at all the events, but.
[00:27:59] You [00:28:00] start to build kind of a fraternity of people who know what they're talking about when you do that. So even suppliers will refer you to their, their clients because they know you can solve their problems. And it starts to create a real web of value in, in, in a, in an ecosystem where you really wanna have
[00:28:14] influence.
[00:28:15] I.
[00:28:15] Corey Quinn: So it's fair to say that you, it's much more difficult to build that. Network and build those relationships if you're not going to these conferences and having these shared
[00:28:25] experiences.
[00:28:26] Dave Hansen: Oh, you're gonna have to spend thousands and thousands and thousands of dollars on marketing to build brand and awareness on cold call dialers. And the reality is a lot of people don't wanna talk to someone on the phone right now, and they, you know, they don't want to answer their email. They get everyone's sending email.
[00:28:41] Right. That, that's, that's such an overplayed, uh, marketing process. It's important, it's important to do. It's an also also ran idea, but, but you really want to get to the right person. You're gonna do it at these events a lot faster, with a lot less expense, especially when you're small. I don't have time to fly to Atlanta and then DC and then Chicago and, [00:29:00] and sit down with one person at a time.
[00:29:01] I'd rather bump into them at the event and build a real relationship and then have context to call them afterward. It just accelerates the whole
[00:29:08] sales process.
[00:29:10] Corey Quinn: Some people call word of mouth the holy grail of marketing. How do you define word of mouth?
[00:29:17] Dave Hansen: Hmm. Uh, well that's like a, a softball question. I wrote my master's thesis about this, so, um, yeah. Woo. Better be a good freaking answer now. Right? Um, the, uh, word of mouth is, is I think it comes in a couple of channels. But it's really when you're having a conversation with somebody, either physically or even digitally and somebody says that, that they trust, cuz you're in their inner circle, they say, look, you have that problem, you should look at this solution.
[00:29:45] Uh, that happens for us a lot in social media. It also happens a lot in, in person, uh, or over zoom or over phone calls. Right? So building. Uh, the trust with the, the influencers in the industry. That's, that's really how you build [00:30:00] scalable Word of mouth marketing is find the influencers who align with your services and then make sure that they're, they're, uh, they understand who you are.
[00:30:08] They get to know you, they trust you, and there's mutual value in them referring their clients to you. That's, that's one channel. Another one is just having clients who love you and, and. You have to kind of prime the pump with them. You have to let them know, Hey, people that work with us, they like to, they like to tell people how much they referred, how much they love working with us.
[00:30:24] How did you hear about us? That's right. Bob told you about us. So if we give you great experience, don't hesitate to tell people about us. We can help solve their problems too, and that you mobilize. Your b your your love group, right? Your customers should love you. If, if that, if you're not doing that, that's, that's step one.
[00:30:40] You will not build a word of mouth program that's successful if you're not giving people an experience that is unforgettable in a good way. Uh, your negative word of mouth, if you give them a, an unforgettable experience in a bad way, will be much more powerful than your positive word of mouth. So, That's key.
[00:30:54] You gotta, you gotta deliver an incredible experience. And then people, uh, people tend to talk about it [00:31:00] and then giving them cues so that they remember to do it. We have, we use our own system to remind people and nurture them, ask them for referrals here and there. And, um, and as we do that often, you know, a month or two later we'll get a referral because they thought, oh yeah, I should introduce Steve to Dave.
[00:31:14] Corey Quinn: What role does word of mouth play in your current ability to grow? does it generate majority leads, some of the leads, some revenue, a lot of the revenue? Like how important is it for you today?
[00:31:23] Dave Hansen: Strategic business partnerships, uh, uh, have, have driven a lot of revenue to us. Um, I would say it's key. Uh, it's key. It's probably the, the best clients that we've gotten. Most of them have come from, from referrals. and the fastest sales cycles that we have have come through referrals. The least maintenance clients have come to us from referrals.
[00:31:43] So I think the, the, that's a key channel that I think we've done. Uh, we've done a good job developing here and, um, And, and it, and it's, it's critical for our success. I would say at least the majority, probably just a little over 50% or more of our leads come from referral sources. Now.
[00:31:59] Corey Quinn: [00:32:00] That's fantastic. Truly fantastic. We've been talking a lot about the positives of verticalizing. What are some. Negatives.
[00:32:06] Dave Hansen: okay, I'll tell you one. Uh, we, we originally, we were looking at maybe getting some growth capitals. We started hitting an inflection point. We said, Hey, This is a great opportunity. Let's go and let's have somebody capitalize us. We, well, we have a very clean cap table, so let's grow this baby. And I found because we had verticalized that a lot of the folks said, nah, you're, your Sam's off.
[00:32:25] your TA's off your total addressable market. There's no way that you guys can turn out the type of revenue and the returns that we're hoping for. And we said, nah, you're wrong. You don't see the market the same way we do. But they're like, We're investors, trust us. So, uh, we said, fine, screw you guys.
[00:32:39] We'll just become profitable and never have to worry about you again, which is what we did. Um, but, but it did actually limit our ability to go get capital by, by, over, by getting very, very focused in this particular vertical. So I'd say it's one of the only negatives that I could really say. If, if you picked the wrong one though, let's say you picked the wrong one, or, uh, as an example, let's say you picked, [00:33:00] um, Oh, a vertical that's gonna start to, to die off as the economy takes a little bit of a turn.
[00:33:06] So something like, let's say a, like a, a like a bougie personal treatment type thing. All that stuff's gonna start to slide a little bit. Um, or let's say you pick a vertical like, um, hr, uh, or ver like learning and development, internal, internal. Oh, this is a great one. Internal promotional or reward systems.
[00:33:24] What's the first thing that gets cut as soon as the economy takes a slap? That, so if you're focused on that particular vertical and you see a bit of tough headwinds, you're gonna have a bumpy road for a little while, but, but don't be afraid because you can earn market share. That's what people forget.
[00:33:39] Even though it's a tough vertical, it might get impacted by. By, uh, you know, a downturn in the economy, your, your competitors are gonna stop investing. So even so, it's still great. You keep investing, you keep marketing, you keep going to events, and when you get outta the headwinds, you're gonna have eaten up three times the market share.
[00:33:55] You could have been a good
[00:33:56] economy, so it's still good. It's just that it could
[00:33:58] be
[00:33:58] tough.
[00:33:59] Corey Quinn: I love that [00:34:00] contrarian perspective. That's awesome, Dave. Um, was there any point along the way where you thought verticalizing was not the right choice for the business?
[00:34:13] Dave Hansen: Um, no, I, I, I, I didn't, after like, it was clear we needed to, and then after we did, the clear rewards were coming through. So, uh, we picked well and, uh, and, and truly, you know, following Jim Collins, like the advice, what are we better than everybody else in the world? As long as you're following his advice on that, on that particular decision, as you're verticalizing, I, I don't think you'll, you'll regret it if, if you do regret it, you gotta check your strategy and make sure that you're following, you're actually.
[00:34:40] Truly verticalizing as as you committed. Cuz a lot of people, they'll say we're verticalizing, but then they're like, well, we'll keep taking that and this and that. So I, I think because we were pretty disciplined, it's really been a great, a great benefit to us.
[00:34:53] Corey Quinn: What would you say to someone who's maybe listening to us right now who is in a business that [00:35:00] has maybe flatlined, is struggling with keeping customers happy, keeping them retained? Uh, their cost per acquisition is really high. Maybe cuz their, their marketing is very generalized.
[00:35:11] What would you, what would you, what would be your advice to them regarding verticalizing the business?
[00:35:18] Dave Hansen: Uh, the first thing I would say is you need to call my friend Corey Quinn, uh, because he's an expert at this. So talk to the man who knows this stuff. Uh, and then the second thing I would say would be, uh, who is your best customer? Like, who is your lowest maintenance? Highest revenue, highest margin customer?
[00:35:35] Show me the top 10. What's similar about these 10 people? Uh, and, and, and some. And sometimes you just have to let the, the numbers speak for themselves. Now, they might not all be in the same industry, but you're gonna notice a trend. And, and that's what you have to find is the pattern. So if you see the pattern, you say, you know, it's funny, they're not all the same, but they all have the same need that we solved.
[00:35:56] Like, what's that? Well, they, we solved this need. Okay? Now where [00:36:00] can you find a group of people who have that need very consistently? Oh, well, these two or three places. Beautiful that maybe you didn't verticalize in one specific supertight niche like I did and we did. That's fine. But you verti, you can verticalize around a specific target of, of pain points that you can address in a market.
[00:36:18] So maybe you don't go after just chiropractors, you go after chiropractics and dentists and physicians because it's a terrible example. But you know what I'm trying to get at here, because they all have the same, they need to engage with their
[00:36:29] patients.
[00:36:30] Corey Quinn: Mm-hmm. So, so in other words, you're, you're, you're focusing your business around being the best in the world that's solving a specific problem
[00:36:38] Dave Hansen: Right.
[00:36:38] Corey Quinn: a specific audience.
[00:36:40] Dave Hansen: Yeah.
[00:36:41] Corey Quinn: Last question, Dave, what is your motivation?
[00:36:45] Dave Hansen: man. Well, I've, I, I'm still fairly young. Uh, my motivation is I, I really want to build this organization, uh, the company I want, I want to solve. I mean, I, I'm a sales consultant, right? Like at at heart, and, and [00:37:00] every day I'm fixing people's problems, like in a massive way. I mean, across 120 locations, I'm fixing people's problems and systematizing things that are helping Joe Blow.
[00:37:10] Terrible operator. Truly succeeded his business and pay his bills on his own, be his own boss successfully. Like, it's, it's truly rewarding to see the outcomes of what I get to do here. In a way that's, and, and I don't mean that to sound chintzy or like, I wasn't rehearsed, but like I, I really love what I do.
[00:37:26] It's like I was born to help people fix the crap when it comes to businesses and sell strategy. So I just happened to be in a position where, I do it for a living. So I, I'm really enjoying what we do and seeing the company grow, you know, knowing the number of people that we employ that are all paying their bills, uh, because the company's succeeding.
[00:37:44] Like I, that sort of stuff keeps me very happy with what I'm doing.
[00:37:49] Corey Quinn: That's fantastic. Dave, this has been so much fun. I think it's been a ton of value for me. As you know, being on the other side of the microphone here as well as I'm sure for our listeners as [00:38:00] well. Thank you so much for joining Dave.
[00:38:02] Dave Hansen: Yeah, my pleasure. Thanks for having me on
[00:38:03] Cory.
[00:38:04] Corey Quinn: All right folks. That's it for today. I'm Corey Quinn and I hope you join me next time For the Vertical Go-To-Market podcast, please hit subscribe and if you enjoyed the show and received some value from it, I would love it if you would give me and this show a five star rating and review on Apple Podcast.
[00:38:23] Thanks so much and we will talk to you next time.
