DeepSpecialization_Jeff Tomlin_EP 66_Video_Edited_V1
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[00:00:00] Welcome to the deep specialization podcast, the show where we blend focus, strategy, and client intimacy in order to scale and simplify our businesses and our lives. I'm your host, Corey Quinn. Let's jump into the show. Today I'm joined by the co founder and CMO of Vendasta, Jeff Tallman. Welcome, Jeff. Hey, thanks for having me, Corey.
[00:00:21] Glad to be here. Yeah, I'm super excited. You know, you and I are, maybe we've crossed paths a couple times. I've been on your podcast once, but even way before then, You know, we, we were both operators in the small, local side, local, small, local business space with marketing and technology. So I've been looking forward to this, this interview for a long time.
[00:00:42] I'm excited to hear your story. Can we kick things off by just asking you to share with us about sort of the work that Vendasta does and who you are? Yeah, so I mean, in a nutshell, fantastic builds technology for small, medium sized local businesses to operate and grow. And so, you know, that we started out providing solutions in the marketing stack and that then in the advertising stack with our ad platform.
[00:01:10] And now we provide all sorts of different productivity tools as well. And. We sell primarily through a channel. So, you know, Vendasta isn't the biggest brand out there because we've been the guys behind the guys and, you know, it's changing somewhat in the way that we're going to market now, but primarily we've gone to market through channels with Vendasta.
[00:01:32] By working with agencies and media companies and other technology firms that have massive amounts of small business customers. And we help them find better ways to go to market. Yeah. And how many, how many channel partners are you guys working with these days? Well, we've got over 60, 000 that are signed up to our platform and several thousand of them are paying and larger customers and all the way from massive enterprises to small and medium sized agencies.
[00:01:58] So you, you're quite a substantial business and you, although maybe not everyone's familiar with the brand Vendasta, you do power a tremendous amount of digital marketing online today. Yeah. I had to pinch myself, you know, uh, just chatting with some team members the other day. Going into our 17th year this year, and I can't believe it's been that long.
[00:02:20] It definitely doesn't feel like 17. And, uh, I don't, I definitely don't feel like I'm 52.
[00:02:28] I'll be, I'll be 50 this year. So I, I, I, I know the feeling, it moves quickly, but you know, I, I, I think it hurts a bit more, by the way, my, my, my son just joined wrestling. He's a, he's a 16 year old and he's in his second year of wrestling. And now he always, he thinks he can take his old man. And so he, yeah.
[00:02:47] And he hurts me and, but, and I can't let on because I can't let him know that he's close to taking me. Yeah, no, I, I, uh, I just got over a, uh, some kind of pull in my neck that lasted usually that would last like a day or two lasted two weeks. And that was from wrestling with my son. So yeah, it, it doesn't, uh, don't bounce back quite as quickly.
[00:03:10] So let me see this back. So you, you're the, you're the technology and marketing stack for a lot of, Partners who leverage your technology to deal directly with the customer. So your, your, your primary customer are the, are the channel partners. You don't necessarily deal with the small mom and pop businesses that are leveraging the technology.
[00:03:31] Well, it has been up until, you know, just recently in the, in the last couple of years, we've got a couple of acquisitions. Brands that we've bought that have different technology platforms in the, in the marketing space, in the sales space. So we, we purchased Yesware and we purchased Mad Matchcraft and a company called broadly.
[00:03:51] So that's, that's growing out our capabilities, but, you know, traditionally what we've, What we've been focusing on is growing the capabilities of a channel partner so that they could go to market more efficiently and more efficiently and serve their customers in a better way. And so the, you know, the goal of our company has been to provide everything that a channel partner needs to build out different variety of solutions for their small business customers.
[00:04:18] And then so build market, build, sell and fulfill solutions. Market, market, sell, build, fulfill and deliver solutions to their customers. Yeah. So, so could you help us by defining what a channel partner is in the context of your business? Yeah, so anyone from small agencies to medium size and large national agencies, we work with technology firms, so tech first firms like web.
[00:04:47] com and cars. com that service particular verticals. We work with MSPs and VARs who are moving beyond just IT services. And get it selling more martech type solutions. These days, media companies. Traditionally, that's where we got our start in in media companies. So that was newspapers, IYP radio and TV solution providers.
[00:05:10] And then we work with franchise groups to a lot of franchise. Operate as sort of the agency for all of their locations and work with those types of companies as well. Fantastic. And so the big focus is not only providing the software and the technology platform, but also the means to help them to be successful in working with their customers, using your technology.
[00:05:31] A hundred percent. That's awesome. We, you know, we, we, we got there from, well, a bit of a story. Let me tell you the story. How, how, how, yeah, I was going to go right there. I'd love to hear like, so how did, how did this sort of unfold? Well, the, the, the very first product that we got out into the space was reputation management.
[00:05:51] And when we started building the company, you know, we were, and maybe I'll start there. We had to consult to eat, and we were lucky enough to, as we started the company, to get a two year contract to build some proprietary technology. And as we did that, three of us broke off and built a business plan for our own solution.
[00:06:11] Way back then, we were thinking of building, you know, a platform for homeowners to find and share inspiration about their home renovations, and get connected with service providers that, that other homeowners recommend. And we were going to monetize referrals. And the way that we were going to do that was to build this home, the social network for homeowners to share things, inspiration about their home projects, and then we're going to build a reputation management platform provided for free to home service providers and put the two audiences together.
[00:06:42] And as we did that, the, the, the social network for homeowners never really took off, but we found that there's this huge demand for online reputation management. And because, you know, the way people shop was changing, you know, this was back in 2008, 2009, and, you know, a small businesses brand was less about, you know, what they would say it was in, in, uh, in their advertising campaigns and more about what user generated content and online ratings and reviews were, that were being shared, indicated.
[00:07:15] And so there's this massive demand for it. And as we decided to focus on it, we said, well, we've got two options. We could build out our own Salesforce or we could partner with people. And at the time we advanced ourselves as a technology first group. And I, we didn't have experience building out massive Salesforce.
[00:07:32] So we decided to partner and the, we started out in the media space because the timing was perfect at the time. You remember back 2008, 2009, traditional media companies were facing this cliff of revenues. Traditional revenues drop dropping off, and they were looking for digital solutions to sell to their customers to build up their revenue, and so it was just it was a fantastic fit.
[00:07:57] And at the time, we signed up, you know, probably 75 percent of all of the major newspaper groups in the United States in a very short period of time, and we've moved to IYP and radio from that. And then it kind of It grew and we learned a couple of things through that process and, and, you know, this is how the platform came to be.
[00:08:16] You know, our focus initially was on providing these point solutions for, for a small business, reputation management, social media management, helping post to social media, multiple platforms, local listing management, mobile optimized micro sites at the time. So those were the small business tools, but we realized if we were going to Through a channel.
[00:08:37] We really had to be all in in the channel strategy, you know, if you've got companies that are selling technology that they're not building in house, they need to learn about the actual solution. They need to think about it. Learn how to sell the solution. They need marketing collateral. They need tools to help serve their solutions and, and help, you know, with things like billing to make it easier and integrating with the, you know, the rest of their stack.
[00:09:03] And so, you know, that's how we started, you know, came to build out the entire platform around and helping them first to market and then, you know, sell, build, fulfill, deliver all the solution. So I can imagine, you know, especially with new newspapers and yellow page, where they historically had these massive sales teams that were distributed across the entire country or multiple countries.
[00:09:26] So I can appreciate the need for being able to provide that to them. I'd love to back back up even before 17 years before you started doing the consulting and before you built the software. What was going on in your life that, that, uh, led you to consulting? Well, I got out of university in the mid nineties and I had an economics degree.
[00:09:50] And the only thing I knew for certain was that I did not want to be an economist in any which way or form. And I couldn't, I couldn't imagine anyone who would want to be. And so, you know, I, I got a job right out of university, cutting grass and painting fences and trying to figure out what I wanted to do.
[00:10:06] But I got together with some buddies and. Figured this is back in probably 95, 96. I thought you could make some money with this internet thing. And we built a website to sell resume and cover letter templates. And so we made a whole bunch of resume and cover letter templates in Microsoft word, and they would just drop down boxes and form fields.
[00:10:26] And, uh, I mean, it was a terrible product, but it was just a zip file of Word documents. But, you know, we, you know, I learned how to write for the web and I learned how search engines work and how, how to build traffic. We treated it like a hobby, but I sold a quarter million dollars of Word documents and that's Sort of what got me hooked at the time.
[00:10:49] Yeah. And then, you know, we, we went on to work for a company called point two technologies, which built real estate technology. And, uh, you know, that's where we got into, you know, building and selling software as a service and as hooked. So specifically, it was you're building software for that, that company.
[00:11:07] It wasn't that you're providing marketing services specifically, right? And way back at point two, we were, we were building software and providing to real estate. And, uh, I was there from 2002 to seven. And when we started Vendasta in 2008, You know, the company consulted for a couple of years because, you know, in the early stages of a company, you've got to do everything that you can to get off the ground and take every bit of revenue that you can any which way you can.
[00:11:36] People are offering you money to do anything. You're taking it. And, you know, that's what the early days look like. But we were fortunate enough and I'll tell you a story about, you know, how we. We started to build our own product. We started in 2008 and we began consulting right away. That let us eat. And the company that we were consulting for prepaid some of the contract, which actually let us hire a team and start working.
[00:11:59] And it's amazing. I don't know if we could have done that in today's day and age, but we built a business plan for our own technology. And we raised 3 million six months later to build our own platform. And we, we had, we had no product. We had no reference customers. We had zero revenue. We just had a piece of paper, a business plan, and it's unbelievable how we were able to raise 3 million with just a business plan.
[00:12:28] I don't think you'd be able to do it today with, you know, no reference product and no reference customers at all. So we were incredibly fortunate, right place at the right time, met the right people, and we got a break. So was the business plan specifically about the reputation management software at that time, or was it some other business plan or some other product you were considering building?
[00:12:52] No, it was that plan with the homeowners, putting the homeowners together with the home service providers and you know, the reputation management at the time was just half of the equation. It was just meant to be for the service providers. And we'd mainly make money off referral fees. It, it didn't work out, but I mean, you have to be, you know, the first lesson that we learned there is.
[00:13:12] Boy, you have to be able to pivot and you see one thing that's working, abandon the thing that isn't and quickly chase the thing that's got traction. And for us at the time, it was online reputation management. And what was, what was happening with that part of the product that told you that it was had a lot of promise?
[00:13:30] Well, we were, we had just a free solution right at the time. And it was going to be something that we'd give away just in order to build an audience of, of service providers. But they, they not only signed up in the hundreds of thousands, they were using the software. So we knew we had, we had product fit and we just had to figure out market fit then.
[00:13:52] And so then the, you know, that job was finding a, you know, how we were going to sell it and that's how we settled on the channel. And it, and it, and it. It tended to be, you know, a very efficient way to grow our company, but, you know, our success there was, was in being able to really figure out how we were going to service the channel partners and make sure that they were successful by providing this suite of tools to grow.
[00:14:17] How did you guys land your first channel partner? You mentioned it was newspaper groups to start? Yeah, good question. It's kind of funny. In our very early days, I think it was a company by the name of, there's two of them. They were landed at the same time. Sometimes they argue who was first and who was second, but they came very close together.
[00:14:36] And, uh, one was Hearst. And, uh, Hearst Media Services owns, you know, a bunch of news, a bunch of magazines, newspapers across the company. It's one of the largest privately owned media companies in the world. And we were at a conference and we met a consultant who gave us an introduction. And she introduced us to the right person at Hearst.
[00:14:59] His name is Jeff Volkamer, who is the president of their local edge brand. And, you know, that relationship led to us signing that and Jeff was so impressed with the product that he brought us to New York and interesting thing about the newspaper space and why they turned out to be such a good partner for us is that newspapers, the, and competing newspaper firms are surprisingly cooperative with each other because they don't have Directly compete in the same markets, typically, right?
[00:15:29] You know, they all own their different markets. And so they, they were really collaborative and they shared with each other. Best practices really well, as opposed to most other industries that you'd think of. So when we. We, uh, we got an invitation to go to New York, uh, and Jeff introduced us and brought us into a meeting with heads of 10 of the other largest newspaper consortiums in the U.
[00:15:53] S. And, uh, you know, that's how we, we, we, we really got in there. Yeah. And at that time, was it still just reputation management or were there other aspects to the software? Well, it, at that time it was just reputation management. Right. Quick. I mean, we, we quickly fallen on the heels of that deal, providing other solutions that we built out.
[00:16:14] But at that time, that was, that was the focus. And, you know, we did a really good job of it. You know, still, you know, probably the top solution in the market and it was the right solution at the right time to the right people. And so why not just double down on reputation management, continue to build that out versus kind of build the next sort of logical product product in that suite?
[00:16:36] Well, that's a good question. So number one. The reputation management space was a growing space and we thought that there's a lot of opportunity there, but we, we had a hunch that our, our chances of keeping customers and our chances for our channel partners to keep their customers would be greater, the more things that they could serve them at the time.
[00:16:57] And a lot of the MarTech solutions, especially social media management, local listing management, we're all very complimentary solutions. You know, you have to build out a presence and then you have, you know, you have to look right, you know, yeah, and you need a good reputation because they, your presence, that was right around the time when search engines were getting an opinion.
[00:17:20] The ratings and reviews were showing up in line of search results. So not only was a search engine telling you that, hey, here is the result of what you're looking for, but it was telling you whether it was a good result or not a good result by having the ratings and reviews in line. And so the reputation management went hand in hand with SEO work and overall presence.
[00:17:42] And by the way, you know, we followed up with research reports on churn. The small business space is sometimes challenging because it's a natural rate of churn in the space. Businesses coming in, coming into business and going out of business. And in the study we did, we said, is there any correlation with the number of solutions that you provide a customer to the rate of churn of those customers?
[00:18:04] And we found that, you know, there was a threefold increase in retention. If you sold four different solutions into a suite, as opposed to just one. So that validated the, the decision to build out a suite of solutions. Despite that, I, I, I've experienced that as well. Is there any one of the four, let's say of the four best products and most popular products that have a greater influence on retention than the others?
[00:18:30] Or is it, are they all equally? No, it's, it's, it's a good question. And they, they drive, there's different behaviors that drive retention with each of those products. With reputation management, they can have, you can have very long retention, as long as people are looking at the email alerts. And they're, they're, they're just paying attention to what's going on.
[00:18:51] That's still providing value. Something with social media management, you, it requires actual engagement with the customers, they have to use the software and, uh, you know, with a website, it's, it's different websites are really, they have high retention because, you know, people, you've got the domain, you put it on your business card and it's a real pain in the ass to change website platforms.
[00:19:13] Yeah. So, so they have different retention rates, but different types of behavior drives the retention in those products. Yeah, obviously the best of all worlds is that they're, they're heavy users of all the different point solutions within the platform. A hundred percent. Yeah, I, I'll just share from, from my experience, having worked at a company that was, The platform with services on top company, you know, Scorpion, as we talked about, you know, every single Scorpion client got a new website.
[00:19:43] Like that was part of the product. You couldn't just hire us for SEO or for these other things. So as a result of that, I, what I witnessed is Really fantastic retention with a website, especially when they start with you. They get a brand new website, beautifully designed and they have a lot of sort of pride in their, their new storefront, their online storefront.
[00:20:04] It, uh, it has a good impact on retention out of all the products. Hands down websites always have in the, in the, in the, They, they always will have the best retention, I think. So along the way, you mentioned you landed newspapers and that IYP, IYP stands for internet yellow page company. Yes. Uh, they, uh, they're called yell in the UK, but here they're called, uh, Hibu or Hibu, you know, these types of businesses.
[00:20:31] Is that right? Okay. Yeah, that's right. And so, you know, today it seems like how, how big is, how many, what is your sort of total addressable market when it comes to channel partners? You mentioned you have about 60, 000, 60, 000 today, some huge, some really small. What's the, what's the total market of this space?
[00:20:52] Well, when, like the, the, the markets. Enormous. It's it's a when you look globally in the small business space and and you look at about 45 percent of all small business use some sort of agency. It's a and and then an even greater degree when you consider all the different technology service providers.
[00:21:15] It's. So it's about 238 billion if you look at, you know, just marketing and advertising type solutions and productivity, but 238 billion worldwide. That's a good market. Yeah, it's big enough, right. And room for a lot of us. And the great thing about the market is that because things are changing so much, there's so much opportunity right now because.
[00:21:43] You know, the average small business uses, you know, three, over three dozen different pieces. And this is a very small business, three, three dozen different pieces of software to, Run different aspects of their business from their accounting to their marketing. But as you get up to, you know, a few dozen employees, you know, 50 employees plus, it's super common to have over 100 different pieces of software for all different aspects of this.
[00:22:12] If you look at all the different subscriptions, it's good, but there's efficiencies and getting them to talk to each other. And there's a lot of inefficiency right now in businesses and how they manage their, their, their different SAS products that they, that they use. And, you know, our big hairy audacious goal that we have out there is to provide everything that, you know, a small business needs to run their business efficiently and tie it all together so that they talk to one another.
[00:22:41] Or something. You know, businesses can automatically understand, you know, things like how much does it cost to acquire a customer on me, right? What is the lifetime value of our customers and our retention rate are the cost of our sales and our goods productivity assessments. And being able to, to, to, to take all of the different inputs from the systems that they use and provide them an intelligent assessment about how their business is doing and what they can do to make the business more efficient.
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[00:24:29] And I think that solves a big problem. Like a small business owner has enough problems, much less dealing with how to get these 15 different pieces of software to integrate and talk to each other. And then how do they onboard new employees, get them all this stuff. So I think the sort of the all in one value proposition is very strong, especially for a small business.
[00:24:49] But then how do you Think about, or how do you talk about the other side of the argument? Let's say that people who say, you know, well, an all in one platform is never going to be, never going to have an amazing product or on a function by function basis. You know, the point solution software is going to be much, much more, it's going to have a lot more functionality, a lot more, you know, whatever that is.
[00:25:16] Do you, do you ever come across that argument? No, I don't think about that. Yeah. A hundred percent. And you know, there's a few things that we, I, that we're, we're, we're going to, we're going to build because it makes sense with what we already have. But there's a lot of things that we're not, we're, we, we never plan on building.
[00:25:34] Procurement software, we're never going to build that, you know, certain inventory management systems, uh, fleet management systems. We're not going to, we're not going to build those types of things. That's why, you know, whatever platform when you're thinking of an all in one platform, it needs to be an open platform that other technologies can plug into and, you know, at the end of the day, we're not trying to be and build everything for the small business.
[00:25:58] We're trying to be the hub where it all connects and where the system. At the, at the end of the day, we talk about having a system of intelligence. So, you know, first off, you know, a system that they use day in and day out for certain critical functions of their business, especially in the marketing sales and productivity, CRM side of things.
[00:26:19] But, uh, eventually the goal is to have the system of intelligence where, you know, we bring in all of the different information from the systems that they're using, and we tie it together to help them understand their business and this is. Inclusive of sales and marketing and digital presence, but it's not limited to, so it's really the whole, whole, you know, ecosystem.
[00:26:39] A hundred percent, a hundred percent. That's interesting. That's, that is big and audacious. I love that. It, it, it, it's very, it's very big, but we, we can see a path to doing it. But like, like, like you said, you have to consider an open system, but you know, there's, you know, there's a hundred thousand different pieces of software, a SAS, You know, brands out there right now, right?
[00:27:03] You, you, you, you need to think with a, with an open mind and think about open systems that can connect together. How do you differentiate or position Vendasta relative to your competition today? So let's say we have, you're entering a new market. Let's say it's a new geography. What makes Vendasta different than the alternatives?
[00:27:25] Yeah, it's a good question. And it depends on on who specifically we're talking to. But if you're talking about our channel partners, you know, the, the, the biggest advantage that we have for a channel, if you're, if you're a medium, young, small, medium sized agency out there, is that we provide a lot of things.
[00:27:45] That you need to run your business that are all connected together, and I'll give you a couple of examples of the advantages of having a connected system. And so we have a marketplace of products that you can sell. You can add your own proprietary things into the marketplace, integrate with it, and they automatically feed into this customer log in the reporting feeds into the customer log in the customers only.
[00:28:11] They, they only need to know. One username and password, they go to one place for all of their reporting, one place to access all of their products, and you've got one way to build your customers, one way to fulfill your customers, one way to market and serve. And so your CRM is there, your marketing system is there, your marketing automation system, your billing system is there, and your task management and service center is there, which has all sorts of automations.
[00:28:42] And having all those things tie into the products that you're serving gives you a certain level of intelligence about, uh, Number one, which prospects are showing the most interest along that journey, which ones are moving along the pipeline the fastest. And then once you've sold to them, which ones are showing interest, which ones are using the products the most, which ones are looking at other solutions in the, in the, in the marketplace that you can upsell.
[00:29:08] And so there's a lot of efficiencies to having a connected system. When you're thinking about how do I scale my business? When it comes to ideal fit for, for your platform, what size agency, you know, at what point in agency's life cycle should they start looking at a partner such as you? Well, we do have a lot of entry level businesses that are using our platform coming on and using it out of the gate, and it's a fantastic solution to get started, especially if you know, people are very, very early in in their in their life cycle because it provides, you know, really a business in a box, the products to sell the CRM and the marketing automation, your billing system and the customer dashboard at the end of the day.
[00:29:50] So, really ideal for that but. It's, you know, medium size and larger agencies get a ton of mileage. We've, we've got customers that we signed back in 2000 and, and, uh, we still have them on our platform. And you can see that all the way through our cohorts because they've built their business around our platform and it's helped them scale in ways that they couldn't have imagined.
[00:30:15] That's amazing. I love the value proposition of helping an agency owner to not get caught up in the minutia of the operations or the plumbing of the business, but they get focused on sales and marketing and working with customers, which is really the highest value activities. And which you got to do in the early days, right?
[00:30:36] Like, yeah, that meat and potatoes, early days, you've got to be out there hustling. Looking back now, you've been, you've been in business, gosh, 17 years. What are some of the, sort of the major milestones along the way? You mentioned, we've been into the sort of the birth of the company and the first landing, the first client.
[00:30:55] I love asking one question of founders. At what point did you hire your first salesperson? Oh, well, we had, we had a big founder group, right? There's initially eight of us that started the company. One, one guy left shortly after we started. So we said seven after that, but we all had a function at the time.
[00:31:12] And so if I was being really technical, we, we hired our one sales guy right out of the gate, but he was one of the founders, you know, one of the sales leaders, we, we got to a point where we had probably four sellers. And we said, Hey, we've got to scale this now. And so we need someone to put, you know, form and function and repeatability into this.
[00:31:35] And so, you know, his name was George and we hired George probably 2013 or so. And, you know, scale the, you know, for many years, you know, under his, under his leadership. What was, what was George's background? What are some of the things that helped? To make about him that helped to make sure that he was a success.
[00:31:59] Obviously, if he was stuck around for a couple of years, he helped you guys grow. What was, what were some of the contributing factors? Well, a few things. Number one, he had a background working at media. So he's an old media guy. So he knew how to speak to a lot of our customers and knew how to speak to them better than, you know, we did it at the time.
[00:32:18] And, uh, although I I think I was pretty damn good, but he had, he had a ton of success in the media space. George also owned his own businesses. So he is an entrepreneurial minded guy. And you know, there's, when you're talking to very young businesses and you're thinking, you know, what type of people do you want to hire when you're very early on?
[00:32:40] And I would always say in the early days, you always want to hire entrepreneurial minded people because, you know, You, you need people that can like, you know, pick up the garbage and take the garbage out at the end of the day, they're willing to do whatever it takes to keep the business running and make it successful and they're, they're, they're agile.
[00:33:00] So that the entrepreneurial mindset is, is super important. And then, you know, 20 years of, uh, of sales experience, you know, an awful long ways as well. Beautiful. So media background, entrepreneur, sales experience, all those, the blending of all that. I think it sounds like a great fit. 2013, what was the next major milestone in the business?
[00:33:23] Would you say, well, there, there were, there were a few in terms of the evolution of the business. So I, I, these would be the major milestones of us going back to the beginning from, from a product and evolution standpoint. Number one was, you know, just having our first win with our, with our Our point solutions getting, you know, our first customer with a reputation management, everything got easier after we got our first customer and, and, you know, getting that first one is, is hell sometimes, especially if you're, you're looking at big ones.
[00:33:56] The second major milestone was, you know, realizing, you know, a year to win that we had to be all in, in this channel. Strategy, meaning we need to, we need to provide tools for them to sell. And this is when we built something we called a snapshot report that would allow our channel partners to put in the phone number of a potential business client, and it would tell them all sorts of different intelligent information about their business.
[00:34:23] Online presence so that the salespeople for our channel partners could go in and have really engaging conversations and teach and, uh, it's, it's still one of the most popular pieces of our platform and that started helping us build more and more sales and marketing tools. So that led to our marketing automation system.
[00:34:42] That was sort of the second milestone. The third milestone was when we decided after building four different point solutions, we couldn't build everything that our channel partners asked us to. And that's when we built a marketplace of other third party solutions that could integrate into our platform and our channel partners could sell those, but still have one billing system, one place for their, for their customers to log into.
[00:35:09] You know, the next milestone after, you know, launching a marketplace was to consider the billing system and the service center and focus on becoming an end to end commerce platform. And, you know, as you go through each stage of growth, as we did, you know, it requires a different type of organization.
[00:35:30] There's a saying that says you ship your work structure. So, you know, every time we. You know, we, we made a, uh, you know, a big shift with, you know, these different milestones, you know, we changed the way that we organized, you know, it, it, uh, it's necessary. And speaking of which, how have you changed as an executive, as a leader over these 17 years?
[00:35:56] Where are some of the milestones there? Well, you start out and you have to be the guy that's helping take out the trash and mop the floors and do everything that needs to be done in the early days. And, you know, we hadn't, you know, I hadn't built a business this size, you know, prior to Vendasta and you have to learn how to, how to evolve.
[00:36:20] So from being the guy that. That did everything to the, you know, the, the guy that builds teams and then you have to think of it, you know, how am I going to spend more time working on the business rather than in the business, you know, most recently I stepped back from my, my role as CMO. And, uh, so my official title right now is co founder, and it's gonna give me the opportunity to work with more of our teams and try to figure out, you know, hard problems in our, in, in the company that people are, you know, our different teams are trying to solve that unlock different levels of scale.
[00:36:54] And, uh, you know, I think the real trick to, to, you know, someone like me growing with with your company is trying to figure out how to evolve. From being the guy that wants to touch every single dial and knob and, and turn them and let go of certain things and focus on the business. What type of advice would you have for, let's say the 17 year old, 17 year ago, Jeff, or you know, an equivalent, an agency owner who's just starting off in their, their journey and looking to kind of scale up a business.
[00:37:32] Try a lot of different things. Don't be afraid of failure. Just learn and learn very quickly. You know, one of the things that, you know, a young organization that needs to do is to embrace agility. And when, when we were a young company, that often gets mixed up. Sometimes it's thinking about agile software development and, you know, focusing on how, how do we, how do we be an agile software development?
[00:37:58] We scrum methodology and things like that. But. Really what you, what you learn over time that thinking in an agile way is thinking in a way where you de risk all of your decisions to the best that you can. And so you place very small bets, you prove things out, and you don't make big decisions. You know, massive bets without having a small investment that can prove out your thesis and you, you, you do iterative improvement and you do it all very rapidly.
[00:38:30] And so, you know, being an agile person and agile, having an agile thought process is thinking about how do I de risk all these assumptions and hypothesis that I have. Did that, did that lesson or that, that perspective come as a result of taking maybe a bigger risk? And it not working out or is that sort of more inherent in the culture of the business?
[00:38:52] Oh, it took a lot of big risks that didn't work out and uh, yeah. Oh, yeah. No, i've got all sorts of Battle scars and wounds to, Oh, I don't know, like pick one, you know, we, uh, one that, you know, I make more, you know, later on, back in 2019, we had a big conference that we're putting on a third, third conference that we had and really liked the way that we approached conference.
[00:39:18] They were incredible events. And I, even I would say. Even I, I was, I was impartial. I was putting them on best conferences that I've ever been to. I've been to hundreds, they were mine, but I went over budget by about a half a million dollars and, uh, which is not chump change to, to, to the business. But, you know, when I look back at it now, we, we made a big bet on, on the conference and, I think that, you know, that conference, you know, it was some oversights led to the to the overspend.
[00:39:52] But I think the conference itself was instrumental in helping us land a big round of funding. In 2019, we, you know, right on the heels of the conference, we had some of our prospective investors out at the conference, blew everybody's socks off. Landed $40 million, uh, a few weeks later. Beautiful. And, uh, the, the rest is history.
[00:40:13] So it was, it, it was painful a little bit, uh, but I think, uh, the reward outweighed the, uh, yeah. That's a nice, that's a nice silver line right before Covid too, so it's good to lock that money in right before. Yeah. Well, and then Covid hit and, and , you know, everything went crazy for a while and, and then we raised a big round, it was about $120 million and, you know.
[00:40:36] Again, right place at the right time. And, you know, that's another takeaway, you got to take advantage of those moments when, when, when they come up. And yeah, that was another example of, of that's just, what does the future look like for yourself or Vendasta? Well, you know, there's, we're right, right now we're focused on, On bringing these different centers together, the marketing centers, sales centers, productivity centers into into one place.
[00:41:05] And, you know, I shared with you what our big hairy audacious goal is, and we can see some of the fruits of that starting to come together now. So when I look at the future, I, you know, I see a more intelligent. Way forward for small businesses to, to turn on, you know, critical function technology for their business productivity solutions and CRMs and, and, and being able to, to quickly get value out of them without doing all the plumbing, like, you know, your former CMO, you've probably got scars of implementing CRMs and, and, uh, You know, it's, it's awful work.
[00:41:43] And, uh, those are the types of things that we want to help simplify the course for the, you know, the average business. And, uh, I'm really excited about it. Well, I think, you know, given, given where we're at 20, 24, you know, there's a, you know, software is eating the world. AI is here and all of these things.
[00:42:00] My, I guess my point is that this is a real problem that small businesses suffer from today. And it's going to get solved, right? Yeah. It sounds like your, your brand, your history, your strengths. The relationships you have, it sounds like you're really well positioned to bring that to life. So, and to be the one that's.
[00:42:19] You're exactly right. And the, the, uh, the things that we can do now with AI, it's, it's, it's speeding up innovation for, you know, the companies that are implementing it the right way, and that that's probably what's driving, you know, the, my optimism and in what, what lies ahead so much, because the rate of change and the rate of progress in tools that, you know, not just us, but a lot of companies are providing is accelerating and, uh, It's cool to see.
[00:42:49] Yeah, absolutely. All right. Last question. What's your motivation? It's my motivation. I've, I've, I've got a few motivations, but you know, one of them is my, you know, my, you know, my young son, I got a 16 year old son, by the way, just off to wrestling nationals. Today. He flew out for that. And so I'm pretty pumped about that.
[00:43:12] But, you know, when I look back on what we've built and the legacy at Vendasta, you know, you know, I've always thought ever since we started the business, Hey, I want this. Young guy to be proud of that. Yeah. And proud of, proud of what, what, what, what, what we've built. And so, you know, at the end of the day, we wanna build something that we, that we're proud of.
[00:43:33] And, and for me that means, you know, making a difference and having a whole bunch of different stories behind us of businesses and business owners that, and that we've, uh, we've changed their lives in, in some small way. Well, the, the, the numbers are evidence that you're well on your way of achieving that goal.
[00:43:52] So Jeff, thank you so much for joining me today. It's been a really great conversation. It's been fun to learn about your journey. Thanks so much for having me, Corey. It's been a pleasure being here and, uh, um, hope to have you back on, uh, on our podcast and do this, uh, do this some more. I would love that.
[00:44:09] Thanks so much. That's it for today. I'm Corey Quinn, and I hope you join me again next time on the deep specialization podcast. If you received value from the show, please go to apple podcasts and leave us a review. Thanks. And we'll see you soon.
