Making Millions in Alabama: SlimWare Utilities CEO Chris Cope (Part 4)

Sramana Mitra: When did you start SlimWare Utilities in its current incarnation?

Chris Cope: In 2006 Amazon launched the first accessible cloud infrastructure. The cloud has always been around forever, but what was neat was that with them you were only paying for virtual machines and the bandwidth that was actually used. We were able to have the infrastructure provided by Amazon, which was robust.

One of our ideas was to build a backup service, so we began working on that first. Now there are tons of them. Using our background, we knew where to go and what people were searching for, so we knew how to optimize for that market. Even with that knowledge, customer acquisition costs were just too high. We had a very good product that we were very happy with, but it was just too expensive of a business to be in.

Sramana Mitra: I would imagine that ‘online backup’ would yield a very competitive search term.

Chris Cope: That space is very competitive. Even back then it was competitive. We knew how expensive it was going to be for the clicks to get a customer but the actual conversion ratio of a user to paid customer was very far apart. Today we would probably be able to do much better because people are more comfortable putting their data in the cloud. To pay for our customer acquisition costs in the early days, we would have had to assume the customer was going to remain with us for multiple years. There were other companies with free offerings, and I did not have the forte to take that big of a gamble.

Not everything was a total loss, though. We still had a ton of search data and experience with the cloud. We knew if we could get the cloud working with large masses of databases, we could use that data for something. Utility software seemed like a cool place. A lot of the search terms people were using were about a computer processes, services, specific drivers, or other specific key words that they used to try and figure out why their computer crashed. To be candid, it was the Web 2.0 phase of the Internet where people started giving opinions about things that really drove traffic. We tried to combine the social aspect along with all of our search data.

The biggest thing we had to give us a moat, to make somewhat of a barrier of entry for other companies, was our ability to examine computers and determine what equipment was actually on those computers. There were a lot of products out there that tried to solve driver problems. They would scan the computer, see what model computer was, and compare it their database of drivers associated with computer models. The fundamental problem with that approach is that the chip that is in my computer does not provide information about any customization I have done on my PC. We call that environmental data. For SlimeWare Utilities, we looked at the architecture data for every computer and tried to solve those issues. We can account for customization on a PC.

This segment is part 4 in the series : Making Millions in Alabama: SlimWare Utilities CEO Chris Cope
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