A Serial Entrepreneur’s Playbook: ChannelAdvisor CEO Scot Wingo (Part 7)

SM: How do you conduct sales?

SW: We primarily sell via telesales.

SM: Are you able to sell to the enterprise accounts that way as well?

SW: We do go visit them frequently. That is not a huge deal for us because we are organized by region. A typical rep will visit their region six times a year. We’re generally out there but we have a lot of deals close without us physically meeting.

SM: I imagine your 2,700 SMBs must be all telesales?

SW: The bulk of it is definitely telesales.

SM: Tell me about the financing strategy you used to build this company?

SW: This is our third company, so we decided that this time we wanted to be the leaders in our space. We knew it would be big from the very beginning. Our goal was to become a large independent company. With that in mind we funded ourselves for while and then in 2003 we did a venture round and we have done is two subsequent rounds. In three rounds we have raised $80 million.

We have ramped the business considerably over that time. SaaS is a double-edged sword. It is hard to scale quickly because a lot of the revenue comes in the future. However, the nice thing is that a lot of it is locked in once you get it. When we went through the recession and it did not impact us as negatively as it would have had we been an enterprise software company.

SM: There is a transaction components to your revenue model. Was that component impacted?

SW: Yes. We were flat year-to-year, but we were never down.

SM: Who are your investors?

SW: Series A was Kodiak Ventures out of Boston. Series B is Advanced Technology Ventures, or ATV, also out of Boston. Series C was New Enterprise Associates, or NEA. They are bi-coastal.

SM: How did your revenues ramp from 2001 onward?

SW: 2001 was zero. We are now at the mid-$30 millions. We have pretty much doubled every year until 2008. In 2009 we decided that due to the recession it was time to look at the bottom line versus the top line. We went from high-growth, high burn to a flat year-to-year in 2009. We also became profitable in 2009. Moving into 2010, we are nicely in the quadrant where we are getting 20% year over year growth, possibly at scale. That is where we think we need to be in order to build the independent company that we want to build.

SM: Do you see yourself going public in a few years?

SW: That is a goal of ours. Right now we are focused on getting to $200 million in revenue as soon as we can without burning through a bunch of cash.

SM: How have investors reacted to the growth rate of going from 100% to 20%?

SW: They have been really supportive. I think that VCs are familiar with situations like ours.

SM: Congratulations on your success. I look forward to following your story.

This segment is part 7 in the series : A Serial Entrepreneur’s Playbook: ChannelAdvisor CEO Scot Wingo
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