A Serial Entrepreneur’s Playbook: ChannelAdvisor CEO Scot Wingo (Part 2)

SM: Did you bootstrap Stingray Software?

SW: Yes we did. We eventually sold it for $12 million.

SM: That’s sizable. Tell me about the journey of building a $12 million company organically in three years.

SW: Stingray is when I officially stopped being an engineer and became a CEO. It was a real-life MBA for me. Another co-founder did all the technical work and I handled the business side of things. I learned a lot about accounting, selling, marketing, and product development. One advantageous aspect of Stingray was that we made developers tools, so in essence we were selling to people like ourselves. In that sense it was a lot of fun because we knew what our customer looked like, how they shopped, and where they looked for information, and we used all of that for our advantage.

SM: How did you reach your customers?

SW: We started that business because we noticed there was no definitive toolset for Microsoft Foundation Classes. We worked hard to become a primary source of information for developers, and we did that in such a way that we would gain thought leadership. I wrote a book, and because of that I did a lot of speaking engagements and [became] a recognized expert. We also hosted a frequently asked questions list, which was all the rage back then. We controlled a lot of forums and answered a lot of people’s questions. We quickly became known as the go-to folks for this technology right around the time that it became popular. People fell into the net we had cast by becoming experts.

We don’t have a big entrepreneurial playbook. We have replicated the same play at every company we have built. We spend a lot of time on industry thought leadership. If you do that, it comes back multiple times and effective sales. Your customers and prospects feel very good working with experts. We found that one of the best sales techniques is to not be pushy with sales because your customers expect you to be experts.

SM: How much did you sell the company for?

SW: We sold it for about $29 million.

SM: Did you have to stay behind to assist in the transition?

SW: We had to stay for one year, and some of our shares were locked up effectively. We put in our year and it was kind of painful because we were very emotionally attached to the business, perhaps more so than was healthy. Watching other people come in and dismantle things was painful. It was very interesting being part of a public company and watching how they drafted the quarterly statements, the rules and regulations surrounding a public company, and we learned a lot from their sales force and how to integrate with it.

Throughout this time the Internet was booming. Because we had been around the UNIX world we were familiar with things such as Mosaic when it first introduced. We had been watching the Internet very closely, and we were very early distributors of our products over the net. Developers tend to be very early adopters. After our one-year obligation was met, we left and started another company.

SM: What was your next company?

SW: It was AuctionRover.com. We though e-commerce was interesting and decided that was where our next play needed to be. Initially we thought we wanted to do a comparison shopping engine, but some of the early shopping engines beat us to the punch. Those were companies like mySimon and DealTime.

However, we did notice that all of those search engines ignored auctions or did them very poorly. An auction search engine is much harder because of the temporal nature of auction listings. We went out and aggregated all of those auction sites and gave consumers one central place to find all the different auction listings.

This segment is part 2 in the series : A Serial Entrepreneur’s Playbook: ChannelAdvisor CEO Scot Wingo
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